States Restart Health-Care Push

Tight Budgets May Limit Legislative Efforts to Lift Coverage as National Plan Stumbles

By ANNA WILDE MATHEWS

With the fate of a national health care overhaul unclear, state legislators are pushing their own bills aimed at expanding coverage, though tight budgets are likely to hinder many of these efforts.

Lawmakers in at least two states, California and Missouri, have introduced legislation for the current session to create government-backed coverage for state residents. In others, including Virginia and New Jersey, legislators are hoping to tweak existing state programs to include more people.

In 11 states, lawmakers have proposed bills for this year aimed at improving access to health care, said the National Conference of State Legislatures.

Spurred by continued voter discontent with the status quo, both Republicans and Democrats in state legislatures aim to advance their own proposals, particularly if a national overhaul remained stalled or was scaled back. "The ball's back in our court," said Melvin Neufeld, a Republican legislator in Kansas who is vice president of the state legislatures conference.

The head of the group's health committee, Indiana Democrat Peggy Welch, said states had hit the "pause button" on many health issues, but they may soon be "back for the states to wrestle with."

Before Barack Obama was elected president, much of the focus of a health-care overhaul was at the state level. Some states were expanding coverage, often by widening eligibility for Medicaid and the Children's Health Insurance Program. A few attempted more ambitious revamps, and the most comprehensive came with Massachusetts's 2006 passage of a bill that required most state residents to become insured.

But for now, budget woes are undercutting efforts to add to state-government rolls, and many states are actually cutting health programs. "The dollars are just so tight this year," said Virginia State Sen. Mary Margaret Whipple, a Democrat who sponsored a bill that would expand eligibility for the state's version of the Children's Health Insurance Program.

Like efforts at the federal level, state proposals to overhaul health care are running into partisan divides. In California, Gov. Arnold Schwarzenegger has vetoed two single-payer plans, which would have offered government health coverage for state residents, that were passed by the Democratic legislature. He wasn't expected to sign the latest version passed by the Senate on Thursday if it hits his desk.

In New Hampshire and South Carolina, Republican lawmakers have introduced bills that would allow consumers to buy health plans across state lines, an idea backed by Sen. John McCain during his presidential campaign.

Legislators may be most effective with limited moves to ease the way for consumers to purchase and retain private coverage, or help small businesses struggling with health costs, lawmakers and analysts said. Bills to improve transparency in health-insurance plans and medical pricing may also gain traction.

Some states have already started requiring health plans to cover dependent children in their 20s. Insurers may also face bills attempting to limit what they spend on administrative costs and restrict their ability to exclude consumers based on pre-existing health conditions. Some states could also mandate that insurers cover certain care, such as treatments for autism. The federal overhaul bills included provisions to address these general issues, among others.

To jump-start some efforts, the American Medical Association plans this spring to roll out a "code of conduct" as a model for its state affiliates to use in pushing for new regulations on health insurers.

"We believe there's going to be a lot of interest in many states," said the group's president, James Rohack.

A spokesman for America's Health Insurance Plans, a trade group, said that insurers "strongly support efforts in the states to expand access, improve quality and reduce health-care costs." But members oppose bills to cap administrative spending and mandate coverage areas, he said.

Write to Anna Wilde Mathews at anna.mathews@wsj.com

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