NU Online News Service, Dec.17, 12:41 p.m. EST
WASHINGTON–A provision in both House and Senate health care legislation that would limit insurers' nationally marketed health care products to regulation by one state is coming under fire from liberal lawmakers from Maine and California.
And, in the latest development on health care reform legislation, Sen. Harry Reid, D-Nev., Senate majority leader, today vowed in a speech on the Senate floor to pass the Senate version of reform legislation before Congress departs before Christmas for its holiday recess.
"We're going to finish this health care bill before we leave here," he said.
"For nearly an entire year, we have reached out to the other side, offered Republicans a seat at the table and negotiated in good faith," he said. "Nearly a whole year."
Now, he added, "we're closer than ever to fixing a badly broken system and doing more to make sure every American can afford to live a healthy life more than this country has done in decades."
The interstate compact issue involves a provision in the Senate bill that would allow insurers to sell policies in any state while subject only to the domiciliary state of the insurer.
House bill, H.R. 3962, permits states to decide among themselves which regulation will govern.
In a letter sent to both Senate and House leaders, 31 Democratic House members of Maine and California said if the provision passes, key patient rights mandated by laws in both states will be lost if the bills continue to allow insurers to sell policies in both states while disregarding any state benefit requirements.
Regarding the House bill, the letter says that its interstate compact provision "could make the regulations in the consumer-friendly state irrelevant."
Practically speaking, the letter said, "insurers will domicile their plans in states with less stringent regulations and market to the population in more protective states like ours, just like nationally chartered banks have done."
The contention by the members that interstate compact provisions in both bills are "race to the bottom," uses the same verbiage that a group called Consumer Watchdog, based in California, uses to argue against any optional federal charter for insurers.
In a statement released in connection with the letter, a Consumer Watchdog official said 17 states, which currently have more than 50 health benefit mandates in state law, have the most to lose under the pre-emption provisions.
Those states represent 54 percent of the U.S. population, according to Jerry Flanagan, healthcare policy director for Consumer Watchdog.
Consumer Watchdog is also concerned about an amendment sponsored by Sen. Olympia Snowe, R-Maine, and Sen. Blanche Lincoln, D-Ark., that would bar a state from opting out of any nationwide plan sold by an insurer.
"The Snowe amendment would make a difficult task impossible," Mr. Flanagan said.
He explained that under the current version of the bill, state legislators may nominally refuse to allow insurance companies to sell bare-bones 'nationwide' policies in their state.
"However, the 1,000 health insurance lobbyists estimated to be working the federal health reform bill, and the industry's unlimited capacity to buy votes with campaign contributions, would be marshaled to advance the insurers' interest at the state level," Mr. Flanagan said.
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