To Sue or Create a Health Plan 

Allred calls for state to create its own heath-care plan, Otter backs suit

Health-care reform is poised to get as much attention in the race for Idaho's governor as it has on the national political scene. And here, too, candidates are taking some very different approaches.

Democratic gubernatorial candidate Keith Allred believes that rather than filing lawsuits with little chance of success, Idaho needs to work within the system to take back control.

Allred announced his plan to tackle health care by creating a state-run system at a press conference on April 7. He called out Gov. C.L. "Butch" Otter for dealing with the new federal law by immediately suing the federal government based on the premise that the law is unconstitutional. Litigation isn't the answer, Allred said, adding that it won't do anything to fix the problem. "I prefer finding solutions," Allred said. "I know we can do better than a federal judge."

This is the first time Allred--the likely Democratic nominee for the November general election and founder of independent think tank, the Common Interest--has spoken out about health-care reform. The delay, he said, was in an effort to wait to see what the federal legislation actually said.

Understanding the legislation is something Allred said Otter didn't do before turning straight to the lawsuit.

While calls to Otter's campaign were not returned by press time, he has publicly said that he believes a state-run plan would be just as bad and expensive as the federal plan, and he continues to support the lawsuit.

Otter's Republican primary opponent, Ada County Commissioner Sharon Ullman, released a statement that she supports rejecting the federal reform act, while opening up private insurance between states to promote more competition and lower premium prices.

Instead of legal action, Allred points to waivers written into the law allowing for states to set up their own health-insurance systems, which will allow those states to opt out of various aspects of the federal plan.

Those state plans have to be approved by federal regulators and must provide at least as much insurance coverage, be as affordable and cover as many people as the federal plan. Nor can state plans add to the federal deficit. If those qualifications are met, states can avoid the mandate for all individuals to buy insurance, the penalty for employers who do not provide insurance, and being part of the health-insurance exchange, among others.

Oregon Sen. Ron Wyden authored the amendment, allowing states to create their own plans and waive portions of the federal plan. He introduced a similar idea several years ago in his Healthy Americans Act.

"It's Sen. Wyden's belief that what works best in one state doesn't necessarily work in another," said Jennifer Hoelzer, Wyden's communications director. "This is an amendment that really gives states room to innovate."

The amendment has been gaining attention in recent weeks, Hoelzer said, adding that it was intentionally kept quiet during the bill-writing process out of fear that it would be stripped from the final bill because of the controversy over the public option.

As things stand, the bulk of health-care reform would not go into effect until 2014, with the state-plan amendment in 2017, although Hoelzer said talks are underway to move the start date up so states would not have to adopt a federal plan and then switch.

Hoelzer said the amendment offers a more productive way for states to approach health care. "Rather than spend the time and energy suing the courts, why not use those resources to innovate something better?" she asked.

While Allred doesn't yet offer any specifics, he pointed to health-insurance exchanges set up by both Massachusetts and Utah as examples of states taking control of the issue.

He said that under the amendment, an Idaho plan could have a state-run option that would compete with private insurers and give them incentive to keep costs down. Cost control needs to be the primary focus of any plan, Allred said. The state could also use federal funds to subsidize coverage for low-income residents.

Allred said he believes that by making coverage more affordable, people will be willing to buy into the program, eliminating the need for the individual mandate to buy insurance. He also supports a voucher system allowing individuals to take the amount their employers contribute to their coverage and put it toward an individual plan in a health-insurance exchange.

Allred said he doesn't believe his proposal would conflict with the Health Freedom Act--recently passed by the state Legislature--and in fact strengthens the state's control and reduces conflict.

While the waiver is years away, Allred said he would use the model created by the Common Interest, in which experts would create a policy brief, then Idahoans would be allowed to weigh in on the various aspects of the plan. Those areas receiving the most interest would become the priority.

Ideally, Idaho could learn from work done by other states, but Allred said Idaho needs to be ready to take control as soon as possible. It's a plan he calls a long-term, proactive approach to health care.

"We can't just throw more money at it," he said.

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