By Mike Shields, KHI News Service, March 03, 2008
TOPEKA, March 3 — With the Legislature near the midpoint of its work this year, a major health reform plan that took nine months to birth and involved the efforts of hundreds of Kansans appears to be sinking into the bog of election-year politics.
“The problem, I see, is that we proposed something that the authority saw as a public health issue and the Legislature appears to be taking it as a tax issue. We're not talking about the same thing,” said Ray Davis, a member of the Kansas Health Policy Authority board.
The Legislature last year assigned the health policy authority the task of crafting a health reform plan for its consideration this year. The agency went to work immediately, putting together four large advisory councils and holding meetings in more than 20 cities with a wide range of Kansans, including farmers, business people, health-care and charity workers, and church-goers. The agency’s board held wide-ranging discussions and hired a consultant who devised elaborate economic scenarios for various reform options.
Board members eventually trimmed an ambitious proposal, which at one point included mandated health insurance for all Kansans ages 18 and under, to one with less reach because legislators advised them it would be more “politically feasible.”
The centerpiece of that 21-point plan, delivered to legislators and the governor last November, was a 50-cent increase in the state tobacco tax coupled with a statewide smoking ban.
The purpose of the tax was said to be two-fold: It would discourage smoking, helping reduce a leading cause of preventable death and health care costs; and it would raise the money for the reform’s other components, most notably a new subsidy program that would allow some of the state’s poorest Kansans to buy private health insurance.
But now, even some of the most active and optimistic supporters of the reform package are saying that the tax increase and the initiatives it would have financed will not pass.
“I think that will remain in a dark and black hole for this session,” said Sen. Jim Barnett, R-Emporia, a physician who is chairman of the Senate Health and Public Welfare Committee and a vigorous supporter of the health reform plan.
Davis said one legislator explained to him why the tobacco tax increase was probably doomed in a year when every seat in the House and Senate is up for election.
“Let me tell you what would happen, if I voted for a tax on tobacco,” the lawmaker told Davis. “Perhaps in the primary, but most certainly in the general election, I'd have posters all over my district saying this guy voted to raise your taxes.”
“What he was saying,” Davis said, “is it’s a very tough issue in an election year.”
The insurance subsidy for poor Kansans, or “premium assistance,” component of the reform plan also faces hurdles. Lawmakers last year approved a program, to be phased in over four years, which would help Kansas parents earning less than 100 percent of federal poverty guidelines buy health insurance from private companies. Currently, the state limits its health care subsidy through its Medicaid program to parents earning 37 percent or less of poverty, making it one of the most restrictive in the nation.
But legislators only approved seed money for the program’s design, not the dollars to actually provide services to the poor. So this year, the health policy authority asked the Legislature to put up the money needed to begin providing services and to extend aid to childless adults earning 100 percent or less of poverty beginning in 2011.
Both elements of the premium assistance program, which the health policy authority has spent 3,000 hours developing, now seem in trouble. That's despite support from some key lawmakers and the $1 million appropriated last year to underwrite the program's design.
“I would like to see the proposals advanced,” Barnett said, “including premium assistance for the impoverished in our state. Premium assistance is targeted at the neediest of the needy, the poorest of the poor. Now, they go to the emergency room with diseases diagnosed late and at great cost to all of us. We're all paying for that.”
But negotiations involving the health policy authority, small business lobbyists and senators, including Barnett, have been underway the past few days to merge Senate bills 540 and 541, both of which include some components of the health policy authority’s 21-point plan, including premium assistance.
Full details of the negotiations have not been publicly disclosed, but it seemed likely that the subsidy program would be omitted from the merged legislation.
“I cannot say that with confidence,” Barnett said late last week when asked if premium assistance would be included in the measure.
Some conservatives have criticized the premium assistance plan, details of which still aren’t finalized, saying it would do too little to encourage “market-driven” health care and is certain to be nothing but a thinly disguised expansion of a government entitlement program at a time when it is more important to reign in entitlements .
Meanwhile, the governor and others have questioned why the state should use Medicaid dollars to pay for a plan that would provide lesser benefits for recipients than those who receive straight-up Medicaid. Critics say that would only mean less result for the same money spent; significant inefficiency knowingly embraced just to satisfy free-market pressures.
“We were asked to do a job and we did it,” said Davis of the health policy authority board. “Unfortunately, the guts of it appear to be what’s most problematic for the Legislature.”
The guts of the bill are the tobacco tax, the ban and premium assistance. But neither has there been much progress on some of the reform package’s lesser elements.
The 21 proposed reforms fall into three general categories:
Those that need changes in law include the tobacco tax, smoking ban and premium assistance. But a change in law also would be needed to allow children to remain on their parents’ health insurance policies until age 25. Language that would allow that has been dropped in the bargaining over Senate bills 540 and 541, according to small business lobbyist Ken Daniel, one of the negotiators.
The seven items needing money but no change in law need appropriation bills that haven’t been introduced yet.
Reform supporters point out that the session ‘isn’t over until it is over,’ noting that the most important things tend to happen in a Legislature’s final days.
“There’s plenty to chew on in all of the (health policy authority) recommendations,” said Senate Majority Leader Derek Schmidt, R-Independence, “but the three big ones that are the most difficult of course are the smoking ban, the tobacco tax, and the… the premium assistance. Those are the three big icebergs. There’s a lot of discussion about where they go, and I don’t have an answer for that yet. The rest of the pieces, I think, will get themselves worked out.”
"It is half time," said Marcia Nielsen, executive director of the health policy authority. "What, of course, is interesting about the Legislature, not altogether different from a football game, is that half time often doesn't give us any idea who will win at the end of the game. I'd say it is half time and the score is zero to zero, because we just haven't seen any real action. Last year, we were similarly situated and we still saw some significant action on health reform. And it was unanimous."
Mike Shields is a staff writer for KHI News Service, which specializes in coverage of health issues facing Kansans. He can be reached at mshields@khi.org or 785-233-5443, ext. 123. Staff writer Sarah Green contributed to this report.