Wash. Regulator Has Big Ideas for Health Care

By | January 15, 2008

Hoping to speed up the pace of health care reform, the state insurance commissioner has stepped from the bureaucratic supporting cast with a big idea: take over the market for “catastrophic” insurance, guaranteeing Washingtonians have coverage in a health crisis.

Mike Kreidler, running this fall for a third term as the state’s top insurance regulator, knows the plan could be a hard sell — even to his fellow Democrats in the Legislature and the governor’s office.

But in an interview with The Associated Press, Kreidler said his plan gives Washington a chance to take a leading national role in rethinking how Americans pay for medical care.

He also criticized the Democratic Legislature’s previous work on the health care system, saying it has focused too much on small projects that simply do not get to the heart of the problem.

“That kind of incrementalism will only get you so far. And this is where you have an opportunity to profoundly impact the health insurance system across the board,” Kreidler said. “No other state’s done this. This is dramatic change. It’s one that I personally believe will work.”

Kreidler has been laying out his argument for the statewide catastrophic insurance program in recent weeks through speeches and interviews around the state. The former optometrist, veteran legislator and one-term congressman said he’s faced opposition from both sides of the political spectrum, and expects more.

He’s acknowledges the proposal has little hope of passing the Legislature in the short, election-year session that began this week. One factor could help its ultimate chances: Kreidler wants voters to approve the new employment tax he sees paying for the program.

Some details are still not certain — Kreidler dodged questions about the cost of his program — but it would provide all Washington residents with “catastrophic” health care coverage that kicks in once medical costs exceed $10,000 in a given year. The plan also would cover some preventative care.

It would cover people up to age 65, when they become eligible for Medicare. People who move to Washington would have to live in the state six months to establish residency, and new residents’ pre-existing conditions would not be eligible for coverage for a year. Some people with existing government coverage would be exempt, such as military.

Workers and employers would pay for the program with a new state employment tax, probably 1 percent of gross pay for employees and a sliding scale of 2 percent to 5 percent for businesses, depending on their size.

By substituting the new plan for the type of coverage that typically takes up 40 cents of every health insurance premium dollar, Kreidler said Washingtonians could then buy cheaper health insurance that focuses on their other needs.

Kreidler’s spokeswoman said present consumer spending on catastrophic health care amounts to about $6.7 billion per year in Washington state, but she gave no indication whether the Kreidler plan would cost more or less.

The tax program also would ensure that people without insurance would pay their fair share for coverage, instead of pushing those costs on the system, Kreidler said.

If approved, however, the proposal would likely need a waiver from Congress to skirt federal law regulating employee benefit plans. Without such permission, Washington would face a court challenge, Kreidler said.

The chairwoman of the state Senate’s health care committee, Sen. Karen Keiser, D-Kent, said Friday that Kreidler’s bill would be a featured part of an expansive Senate Democratic agenda for health care reform.

But Don Brunell, president of the Association of Washington Business, said huge plans for overhauling the system are too hasty. He also said plans like Kreidler’s blow past Gov. Chris Gregoire’s health policy approach, which Brunell described as “a very methodical, deliberate process to go through and figure out what will work and what won’t.”

“We think it’s premature to come to any conclusion such as the insurance commissioner has come to in terms of universal health care provided by government,” Brunell said. “We have a basic philosophical difference with the guy.”

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On the Net:

Kreidler: http://www.insurance.wa.gov

Legislature: http://www.leg.wa.gov

Association of Washington Business: http://www.awb.org

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