Issue Brief

Health Care Reform: Senate Bill 1137 & House Bill  2005 

 

Background – The Health Care Crisis

 

Our health care system is the most expensive in the world.  Yet as a system, it fails to come close to providing the best health care in the world.  Medical costs currently consume 16 percent of our national income and are expected to grow to 20 percent by 2015.  This has become a heavy economic burden, with one study reporting that the average family pays $10,728 each year for health insurance. Many employers are trying to shed this cost by shifting the cost of health insurance to their employees or by abandoning health insurance coverage altogether.  Thus, a growing percentage of people living in the United States are uninsured, and families on tight budgets are increasingly at risk. 

 

Despite Medicare, the Veterans Administration, and the Children’s Health Insurance Program, there are still approximately 800,000 adult Pennsylvanians below age 65, approximately 11%, that do not have any health insurance and are not eligible for government-funded insurance.  Many access health care via emergency rooms, which they utilize when medical problems are acute.  The un-insured often cannot fill their prescriptions or, if they do, they cannot afford to take prescription drugs in the recommended dosages.  When costs pile up, many choose bankruptcy as the way out.

 

How Senate Bill 1137 Will Help

 

Senate Bill 1137, which passed the House with bi-partisan support on March 17, 2008 and establishes PA Access to Basic Care (PA ABC), would provide affordable insurance coverage for over 200,000 low-income adults.  People living at 150% of the federal poverty level or below and making $15,600 or less a year ($31,800 for a family of 4), would have no monthly premiums!  Through a minimal contribution from their employers they will be able to begin seeing primary care physicians, taking their prescriptions in appropriate dosages, and stop frequent visits to the emergency room.  People living at up to 300% of the federal poverty level would also be eligible for coverage, paying a premium ranging from $40 to $311 a month.

 

Furthermore, PA Access to Basic Care protects people currently insured by struggling small businesses by providing small employers with grants to help subsidize health care costs.  This provision provides an incentive for small businesses to continue existing coverage, freeing thousands of Pennsylvanians from the worry that they could lose their insurance at any moment.  Additionally, people unemployed for more than 6 months would have the opportunity to purchase affordable coverage.  PA ABC promotes a health care system that values the balance of contributions from government, employers, and individuals.  

 

How House Bill 2005 Will Help

 

House Bill 2005 would give the PA Insurance Department increased authority to regulate rates and insurance products.  The intent of this legislation is to insure that the price of insurance will only go up as the cost of medical services increases.  Insurance companies would be restricted in how much they could spend on administration, advertising, lobbying and profits, as companies will be required to spend 85% of premium revenue on actual medical care.  Increased regulation would also make it easier to shop for insurance.  All providers would be required to sell a standard policy so that people can more easily compare rates.  

 

It is also the intent of this bill that insurance reform would ensure that people have access to coverage regardless of a pre-existing condition.  Medical history and gender will no longer prevent people from obtaining affordable coverage.  Instead, small businesses will pay for their group policies based on a “community rating” that takes into account the average age of their workforce and geography.  This community rating will enable small employers to have less volatile health care costs from year to year.  Everyone who cannot currently get affordable insurance because of a pre-existing illness or injury will benefit from HB 2005, even people who are purchasing insurance individually.  Furthermore, the highest premium for a specific policy could not be more than double the cost of the lowest premium.  Though this means that healthy people may begin to pay a little bit more, they are assured that when they get older health insurance will always be affordable.  Increased regulation will ensure that insurance rates are not excessive, inadequate, or unfairly discriminatory.

 

ELCA Policy Base  (Caring for Health: Our Shared Endeavor, 2003)

 

“The prophetic voice of Jeremiah cried out to the Israelites, ‘Why then has the health of my poor people not been restored?’  (8:22)

  

“The Christian Church is called to be an active participant in fashioning a just and effective health care system…  We of the ELCA have an enduring commitment to work for and support health care for all people as a shared endeavor.   Our Commitment comes in grateful response to God’s saving love in Jesus Christ… God continues to call the Church – its institutions and believers – to work in society for individual and collective actions that promote health and ensure care for those who suffer.”

 

“Government is intended to serve God’s purposes by limiting or countering narrow economic interests and promoting the common good… We call for…appropriate government regulatory reform so that governments can monitor private sector practices more effectively and efficiently…”  (Sufficient, Sustainable Livelihood for All, 1999)

 

What You Can Do: