Sunday, June 05, 2005
By ANNE B. JOLIS
Staff Writer
When a single male buys individual health insurance in New Jersey, his plan has to cover pap smears. When a family of 12 buys a plan, theirs has to cover infertility treatment. When a business employing five women buys health benefits, the coverage must include screening for prostate cancer.
It's the law.
In an effort to make adequate health care accessible to its citizens, New Jersey has mandated 30 particular health benefits since 1972 that insurers must provide for all individuals and small businesses, along with certain large businesses and public entities that purchase their plans. According to a study by Rutgers University published in April, New Jersey requires slightly more than the average number of benefits mandated in other states.
Since 2000, health insurance costs have increased by double-digit percentages yearly, and the number of uninsured state residents has reached 1.4 million, according to the New Jersey Hospital Association. Now, controversy has arisen over whether the mandates are a help or a hindrance.
"We strongly oppose any legislation driving health care mandates," said Christine Stearns, vice president of health and legal affairs for the New Jersey Business and Industry Association. "The problem is the impact they have on the cost of purchasing health insurance. They significantly drive up the cost."
Stearns said the association is lobbying against bill S-544, now before the Senate Budget and Appropriations Committee, which would expand
"So often the mandates are driven by emotion," she said. "Legislators are responding to their constituents' concerns. But the irony is that, in the end, people wind up losing their coverage because the premiums get so high with all the added benefits."
Tom Rubino, a spokesperson for Horizon Blue Cross-Blue Shield of New Jersey, backed Stearns' claims that the mandates contribute to the problem.
"The people proposing these mandates often aren't looking at the cost to the entire system," said Rubino. "Healthy people are forced to buy insurance that essentially subsidizes people afflicted with various illnesses -- which may require expensive treatment. You're trying to solve one problem, but you're exacerbating another."
Rubino said that he would like to see more expert study and input given to the mandates before they're made law.
To that end, the state recently formed the Mandated Health Benefits Advisory Commission. The commission is comprised of 17 members who represent interests ranging from physicians to nurses, insurers to patients, hospitals to academics, and businesses to organized labor. The group will review proposed mandates and report their implications to legislators.
"For instance, we provide an estimate, using actuarial consultants, of the cost of the mandate," said Dr. Joel Cantor, who chairs the commission. He added that the estimated costs take into account the probability that a person would actually use the service covered in the mandate. "So a single man purchasing a plan which would have to cover mammograms wouldn't be paying a whole lot extra for the mammograms, because the chance of his ever needing one is extremely low."
For these and other reasons, he said, mandates probably don't contribute as greatly to soaring health insurance costs as people think.
"While New Jersey's only a little above average with its number of mandates, it has among the most expensive premiums in the country," said Cantor. "So, it's unlikely that mandates are the driving factor in our high health care costs."
He went on to say that mandates are more likely to force insurance companies to better serve patients.
"If the insurance companies were left entirely on their own to establish benefits, they would design packages to attract healthy people," said Cantor. "By standardizing the required benefits, the companies are forced to compete on their efficiency, not on their ability to attract low-cost people."
According to Dr. Craig Wax, a family physician in South Jersey, the mandates are good.
"Insurance companies have been running the show for years," he said. "And they're running it right into their own pockets. Unless they're held to task for the policies they sell, the policies are worthless."
He finished by saying that health care remains a confused issue.
"If health care is a privilege then, yes, private rules only should apply," said Wax. "But that's the problem. America needs to decide whether health care is a privilege or a right."
Mandates raise insurance costs
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