Re: U.S. Senate Finance Committee Holds Hearing

DATE: MAY 6, 2009

TO: NCOIL LEGISLATORS

FROM: SUSAN NOLAN NCOIL EXECUTIVE DIRECTOR

RE: U.S. SENATE FINANCE COMMITTEE HOLDS HEARING ON EXPANDING HEALTHCARE COVERAGE

Provided for your review, is the following information:  Health Insurers Fight for Their Lives (5/6 ABC News)  The Government-Run Insurance Debate (5/6 Politico)  US Senate Panel Roundtable Debates Gov't Health-Care Option (5/5 Wall Street Journal)

You can access an archived web-cast of the hearing by visiting http://finance.senate.gov/sitepages/hearings.htm and written speaker statements at http://finance.senate.gov/sitepages/hearing050509.html.

SUMMARY The U.S. Senate Finance Committee held the second of three scheduled roundtables yesterday (May 5) entitled “Expanding Healthcare Coverage” which, among other things, addressed the merits of a government-sponsored or “public” insurance plan. It featured fifteen panelists representing regulators, consumers, business owners, labor representatives, and think tanks. Committee Members questioned roundtable participants on written testimony that was submitted prior to the session.

The first roundtable, held on April 21, addressed healthcare delivery reforms. A third roundtable, scheduled for May 12, will focus on financing options.

PUBLIC PLAN OPTION Most of the dialogue between Committee Members and panelists focused on the need for and structure of a public health insurance plan. Supporters—including several Democrats and consumer advocates—said that such a plan could:

 create greater competition and consumer choice, especially in areas with few options  spur market innovation by setting a “barometer” for consumer protections and benefits  be structured to operate without government management and play by the same rules as private insurers

Opponents—including several Republicans, insurers, and business owners—said a government plan could:

 create an uneven playing field by giving the public plan a competitive advantage  never truly operate on an even playing field because of its leveraging ability  “crowd out” private insurance plans and could be the first step towards a single-payer healthcare system

FEDERAL PREEMPTION In her written testimony and during the roundtable dialogue, Kansas State Insurance Commissioner Sandy Praeger—representing the National Association of Insurance Commissioners (NAIC)—urged Members to support a state-federal partnership to:  maintain strong patient protections, solvency standards, fraud prevention programs, and oversight mechanisms already in place at the state level  set up broad rules that give states flexibility to implement reforms including the administration of health insurance “exchanges” and cost containment strategies, among other areas  allow states to phase in reforms to ensure the least amount of “negative disruption”

Please contact Jordan Estey by e-mail at [email protected] or by calling the NCOIL National Office at 518-687-0178 with any questions.