Health insurance lobby urges public-private reform panel

By Sean Lengell (Contact) | Thursday, December 4, 2008

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The nation's largest health insurance lobbying group is urging Congress to create a public-private advisory board to develop a plan to cut growth in national health care spending by almost one-third - savings that could be used to help pay for universal medical coverage for all Americans.

America's Health Insurance Plans (AHIP), which Wednesday announced a comprehensive health care reform plan three years in the making, said its goal to reduce growth in health care spending from 6.6 percent per year to 4.7 percent could save more than $500 billion over five years, the group said.

"We need to move forward with health care reform, and it needs to be comprehensive and it needs to include quality improvement, value improvement, cost containment and access," said AHIP President and Chief Executive Officer Karen Ignagni.

The panel's recommendations are nonbinding ones. But with health care costs rising faster than prices of other goods and services, and with President-elect Barack Obama's plans to overhaul the nation's health care system, the medical insurance industry is pushing to be included in the national debate.

"No one should accept the status quote in health care, we certainly don't," said James Roosevelt Jr., president and chief executive officer of Tufts Health Plan.

AHIP also wants Congress to expand government provided health care programs such as the State Children's Health Insurance Program, or SCHIP, and Medicaid. These costly proposals, coupled with health care tax credits for the poor and small-business owners that are also pushed by the AHIP, would require spending cuts elsewhere in order for the group to achieve its goal of a 30 percent spending cut.

But AHIP says the national health care system contains plenty of opportunities to cut costs, including reforming outdated malpractice laws and tying doctor's pay more closely with performance.

"We need to have more uniformity" in doctors' pay, Ms. Ignagni said.

The proposal was greeted positively by some leading health care advocates on Capitol Hill, including Sen. Edward M. Kennedy, Massachusetts Democrat.

"The insurance industry has advanced serious proposals that deserve serious analysis and consideration," Kennedy spokesman Anthony Coley said.

Mr. Kennedy in recent months has orchestrated meetings with lobbyists - including AHIP - and lawmakers from both parties to craft legislation to provide affordable medical coverage to all Americans.

An aide to Senate Finance Committee Chairman Max Baucus, the Montana Democrat who last month announced his own massive health care reform plan, said the senator "is very glad to see the insurance industry come to the table to participate and looks forward to what he hopes will be constructive discussions."

"This proposal certainly adds to the momentum for everyone to come together and work to achieve comprehensive health care reform."

The plan doesn't include a mandate by employers to provide health care to employees. Ms. Ignagni said that, with poor economy, "we didn't think now was the time to recommend" such a proposal.

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