TEXAS: Businesses Fighting Back Against Mandates
After years of seeing state lawmakers approve more and more health care coverage mandates, Texas' "leading business group is mounting a concerted counterattack." The Wall Street Journal/Texas Edition reports that the 1997 state legislative session capped off several years in which new mandates -- "treatments that the state requires group health insurance policies to cover" -- were imposed on employers. In 1997 alone, the Legislature "added more than two dozen new mandates, from diabetes treatment to prostate screening to a minimum 48-hour hospital stay after a radical mastectomy." In response, the Texas Association of Business and Chambers of Commerce has begun "a study of the effects of mandates" and is launching an effort to roll back the coverage requirements. The TABCC "is preparing legislation that would require the state to determine the cost to employers before new mandates are added." Bill Hammond, the association's president, also said the group may lobby for a "de facto moratorium" on mandates in the 1999 session.
According to Journal/Texas Edition, the TABCC review of mandates "is largely a response to a review of the cost of mandates being conducted by the Texas Department of Insurance." The department is expected to have the survey completed by November, but lawmakers may "get their first glimpse at the study's findings Sept. 8." Dianne Longley, director of the department's life and health group, "says a preliminary reading of the results suggests most employers don't cite mandates as a reason for self-insuring and don't believe they should be repealed." However, TABCC "officials complain that the survey was sent only to self-insured employers, not to business owners who are most directly affected" by mandates.
A Matter Of Perspective
Employers say mandates drive up the cost of health insurance, and are thus partly to blame for the fact that "one in four Texans aren't covered by health insurance." Furthermore, many businesses simply self-insure as a way to avoid mandates. Tom Blase, risk and benefits manager for Town & Country Food Stores Inc., whose firm did exactly that, said, "A benefit plan should be like a gift, as an enticement to work or as a carrot to retain people. A benefit plan isn't mandated, so how can you mandate what's in it?" On the other hand, mandate supporters say "they are the only way consumers can get basic services included in their health plans." Kathy Mitchell, research director for the Consumers Union Southwest Division, said, "They provide a floor, a certain level of coverage people need to expect." State Rep. Leticia Van de Putte (D), said, "The reason we do health and safety (laws) is because somewhere along the line there was a tragedy." Furthermore, each mandate is lobbied for by a powerful faction of specialists, who all want their particular procedure covered. Kim Ross of the Texas Medical Association, said, "These are like exemptions in the tax code. They all have constituencies."
Bring Your Own Analysis
State Rep. John Smithee (R) is concerned about the cost of the TABCC's proposal to estimate the cost of all health care mandates. "After you hire some actuaries, lawyers' fees start looking pretty reasonable. It's very expensive to do a true actuarial study." He said that he and Insurance Commissioner Elton Bomer "have discussed a proposal to require groups that suggest mandates to have already prepared their own actuarial study." However, he noted one downside in that some calls for mandates are brought by private citizens who may have been adversely affected by the lack thereof. "I'd hate to say to these folks that they have to bring actuarial studies," he said (Elder/Weil, 8/26).