Prospects Looking Dimmer For Association Health Plan Bill

Small business health plans would have a head start in offering basic plans three months before other carriers, according to one analysis.

The Senate started debate on the bill May 9 as part of the Republican Senate leadership's so-called "health week" initiative, which was widely seen as an effort to embarrass Democrats by forcing votes on controversial legislation they won't support.

For example, Democrats were forced to vote against cloture, which prevents filibusters, not once but twice on medical liability tort reform legislation: once for S. 22, which was the general version that already had failed to win cloture several times over the past few years; and S. 23, a bill with similar language that would only apply to OB-GYN specialists.

The plight of OB-GYNs was a recurring theme for Republicans throughout the debate as they told tales of expectant mothers being forced to drive great distances for pre-natal care because of alleged out-of-control medmal insurance premiums.

On the AHP bill, debate continued with most industry lobbyists expecting that a final vote on the substitute bill would occur either late May 11 or early May 12.

The NAIC has not taken a direct position in opposition, but officials in several large states, including California, have been outspoken in their opposition.

In a statement, California Attorney General Bill Lockyer recently attacked the legislation in the strongest terms, calling it a "federal junk health plan bill," and complaining that it would "eliminate" state health insurance consumer protections.

"By causing consumers to lose the rights they currently have under state laws…, S. 1955 seems to be moving toward federal pre-emption of market standards and policy approval. These always have been within the purview of the states, and Congress should not change a system that has worked very well for over a century."

Health insurance industry critics include many provider groups and such insurance groups as the Blue Cross and Blue Shield Association, Chicago, and the National Association of Insurance and Financial Advisors, Falls Church, Va. The National Conference of Insurance Legislators is also a strong opponent.

Reflecting the dilemma, an America's Health Insurance Plans staff official said, "We are under specific board directive to remain neutral on this bill.

"While we have consistently worked in a bipartisan fashion to provide technical support on issues concerning small business health plans, we have specifically not taken a position on the underlying bill itself," the spokesman said.

But the National Association of Health Underwriters has voiced strong support for the bill.

Democrats were planning to offer a number of amendments likely to be seen as unacceptable to the Republican majority. One, by Sens. Richard Durbin, D-Ill., and Blanche Lincoln, D-Ark., is a substitute bill, S. 2510, which also would allow small businesses to partner to purchase health insurance. It would be based on the Federal Employees Health Benefits Program and would be run by the Office of Personnel Management. Durbin said the bill would preserve state coverage requirements and provide tax credits to help employers get coverage for low-wage workers. He estimated the bill would cover more than three times as many people as Enzi's bill.

Others would extend the deadline for the Medicare prescription drug program enrollment. One, by Sen. Olympia Snowe, R-Maine, would allow the government to negotiate prices to be paid for drugs used under the program.