Tuesday, December 11, 2007 State
Watch
Pennsylvania Governor Outlines New Funding
Mechanism for 'Cover All Pennsylvanians' Plan
Pennsylvania Gov. Ed Rendell (D) has
proposed a new funding source for a plan that would provide health
insurance for the nearly 800,000 uninsured adults in the state, the Pittsburgh Post-Gazette reports. According to
the Post-Gazette, Rendell's Cover All
Pennsylvanians initiative has "fallen flat" in part because of a
proposed 3% tax on the payrolls of businesses that do not offer coverage
to their employees. Although Rendell considered the tax a "fair share
assessment," many state Republicans will not support the plan.
Rendell's new funding plan would use half of the revenue from the
state's Health Care Provider Retention Account, which is projected to
reach $414 million by Dec. 31. The account, funded by 25 cents of the
state's $1.35-per-pack cigarette tax, was created to offset medical
malpractice costs for physicians and hospitals in an effort to keep
doctors and specialists in the state. According to Rendell, fewer
malpractice lawsuits and lower malpractice insurance premiums have led to
a surplus in the account that the state can afford to use. Rendell also
would pay for the coverage expansion through a 10-cents-per-pack increase
in the state cigarette tax, which would generate an estimated $65 million
annually, and a first-time tax on the sale of cigars and smokeless
tobacco, which could generate $50 million annually. He also would use $40
million from a fund that pays for the care of people involved in
catastrophic automobile accidents.
The Pennsylvania House Insurance Committee last week approved the bill (S 1137), and the full House is expected to vote on the
legislation as early as Monday. Republicans criticized a provision of the
bill that would end the state's $207 million in malpractice aid for
doctors on June 30, 2008, if coverage is not ready within 90 days after
the bill is approved. State Rep. Scott Boyd (R) is offering an alternative
to Rendell's plan, which would provide tax credits for businesses that
offer employees health savings accounts and tax breaks for those offering
wellness programs (Barnes, Pittsburgh Post-Gazette, 12/9).
Small Businesses
In related news, the Pennsylvania General
Assembly this week might vote on legislation that would prohibit
insurers from using medical underwriting to determine member premiums, the
Philadelphia Inquirer reports. The bill is
intended to help small businesses provide health coverage to their
workers, but insurers disagree over whether it will.
The measure
would ban insurance firms from basing premiums on the health of an
employee, but it would allow them to adjust premium rates based on age,
region and the insurers' market share.
Independence Blue Cross
officials say the bill is fairer for all groups. However, Aetna opposes the bill,
saying the legislation will make it difficult for the company to compete
with Blue Cross insurers that dominate the state's health care market.
Aetna said the legislation would neither reduce premium rates nor increase
the number of insured residents (Von Bergen, Philadelphia
Inquirer, 12/9).