Tobacco fund aid sought for uninsured

Key legislator proposes using settlement money to expand health coverage

CareFirst grant also envisioned

February 09, 2005|By M. William Salganik | M. William Salganik,SUN STAFF

The chairman of the House of Delegates' health committee unveiled a plan yesterday to provide more medical care for the uninsured using funds from the state's tobacco settlement and a forced contribution from CareFirst BlueCross BlueShield.

The plan drew immediate opposition at its initial hearing, but Del. John Adams Hurson, the Montgomery County Democrat who heads the House Health and Government Operations Committee, said he remains optimistic that a consensus can be reached.

"We've sat here for years not addressing the uninsured," Hurson said.

His bill is one of several that would provide care for the uninsured, a perpetual issue in the General Assembly that has defied resolution.

FOR THE RECORD - An article in yesterday's editions of The Sun reported incorrectly the name of the vice president for government affairs of the Maryland Chamber of Commerce. He is Ronald W. Wineholt.

About 700,000 Marylanders, 15 percent of the population, lack health insurance coverage.

In addition to Hurson's proposal, Maryland Citizens' Health Initiative will be back this session with a "health-care-for-all" measure that has stalled in past years.

The proposal would provide insurance for nearly all of the uninsured by raising the income limits for Medicaid and subsidizing premiums for moderate-income workers.

The same group is pushing a separate bill that would tax large employers that don't spend at least 8 percent of their payrolls on health coverage, using the money raised to expand the Medicaid program for low-income Marylanders.

Sen. Thomas M. Middleton, a Southern Maryland Democrat who is chairman of the Senate Finance Committee, said he is preparing a bill that will be similar to Hurson's but will not include sources of financing.

Hurson and Middleton said their committees will work on the bills separately, with the expectation that a conference committee could resolve the differences between Senate and House versions.

Hurson's bill calls for money to help health clinics where the uninsured can get primary care and a separate fund to pay specialists to treat those who can't pay.

Under Maryland's unique hospital rate-setting system, hospitals provide inpatient treatment for the uninsured, with the costs passed along to paying patients or, through insurance, to employers and the government in their hospital bills.

It is similar to a bill that Hurson introduced last year, which passed in the House and died in a close Senate vote on the last day of the session. It differs in the way it would pay for the expanded care.

Last year's plan would have been financed by extending a 2 percent premium tax on health maintenance organizations, but that source is no longer available because it has been used to help doctors pay for malpractice insurance.

Hurson's bill this year would require CareFirst, the state's largest insurer, to chip in $15 million a year for the clinics as part of its fulfillment of its nonprofit mission.

And it would pay the specialists by using tobacco settlement funds that the state collects from cigarette companies. If that's not enough, it would assess the hospitals to help pay for specialists, with a mechanism similar to that used to pay for uncompensated inpatient care.

All three potential sources of funds drew objections.

John M. Colmers, chairman of the board of CareFirst's Maryland affiliate, said at yesterday's hearing that the insurer supports the bill's goals but considers it "an inappropriate precedent" to direct CareFirst to make contributions beyond the amount it gets in tax breaks as a nonprofit.

He said CareFirst has made a commitment to spend $90 million this year to hold rates down and provide grants to improve care, and that it has an actuary studying whether it can afford to contribute more from its reserves. That should be a decision for CareFirst's board, he said.

Robert W. Wineholt, vice president for government affairs of the Maryland Chamber of Commerce, also opposed the bill, saying it would raise employers' benefits costs.

"By now, it should be self-evident that increased costs imposed on health insurance carriers will, in time, be passed on to purchasers of health insurance," Wineholt said, referring to HMOs, which are passing on the new 2 percent tax to employers and individual members.

Eric Gally, a lobbyist representing the American Cancer Society and the American Heart Association, opposed using tobacco restitution money, which he said is needed for programs to discourage smoking and to treat smoking-related diseases.

The Maryland Hospital Association and Robert Murray, executive director of the state's hospital rate-setting commission, said using a hospital assessment to pay doctors could run afoul of federal rules.

Middleton said he, too, is reluctant to use tobacco funds and that he doesn't think there is a realistic chance of passing a new tax to finance the program.

The senator said his bill would provide the care as money became available. "There's no money," he said.

Hurson said he will meet this week with Gov. Robert L. Ehrlich Jr., and hopes to win support for his approach.

Shareese DeLeaver, an Ehrlich spokeswoman, said the administration has not had time to study Hurson's bill. She said the administration has supported universal health coverage in concept but will not offer coverage expansion initiatives this year because of the tight budget.

Vincent DeMarco, president of the health initiative group, said universal coverage remains a long-term goal but that his group will support more limited coverage expansions in the short term.

He said business groups are beginning to support taxing large employers who don't provide full coverage, because they realize that the cost of treating the uninsured is being built into the premiums of employers who provide adequate coverage.

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