Rising health insurance costs are crushing Connecticut families and small businesses. From 2008 to 2014 deductibles in our state rose 67% for families and 50% for small businesses.
The Connecticut Option, Democrats’ newest public health insurance option bill, not only improves feasibility of the concept but also begins to address the foundations of rising health costs. With less than two weeks left in the legislative session and headwinds from powerful special interests, it’s unclear if it can pass, but it’s a step in the right direction.
This session, lawmakers are considering whether to create a public health insurance option, accountable to government, to bring down costs. Previous iterations of the public option this session included using the state employee plan, which is too expensive, and Medicaid, which was a terrible idea for many reasons. They have now moved to the much better idea of creating a de novo plan, sponsored by the state but operated through private insurers that can be tailored to the needs of Connecticut’s struggling consumers and small businesses. It’s still unclear if it can work, especially as it relies on the participation of private insurers who still oppose the entire concept, but it’s an improvement.
Administrative efficiencies and pooling in a public option may unlock some savings, and anything is an improvement. But the newest iteration goes further, incorporating other provisions that vastly improve the legislation. The best news in the bill is that Connecticut would seek federal approval to import prescription drugs from Canada. Drug prices are the largest driver of rising health care costs in Connecticut.
We are second in the nation in per person prescription costs and they are rising faster here than all but two other states. Americans pay over four times higher prices for prescriptions than Canadians, mainly because their single payer system has the clout to negotiate more realistic prices from drug companies. Accessing the same prescriptions at lower Canadian prices could significantly lower healthcare costs in our state. There are other options Connecticut can and should pursue to lower prescription costs, but reimportation is an important step forward.
In more good news, the bill also restores HUSKY eligibility for thousands of struggling low-income parents recently cut off due to budget deficits. Very few of those families have the means to purchase coverage, even with subsidies. The bill also adds state subsidies for low-income and working families to buy insurance. Current federal subsidies just aren’t enough to make coverage truly affordable for many. The proposal creates a state reinsurance program that helps stabilize insurance premiums. To boost competition, the bill requires plans that cover state employees to also offer plans through Access Health CT, our state’s Affordable Care Act insurance marketplace. More competition would give consumers more options and could lower costs.
Unfortunately, funding for some improvements in the new bill depend on other provisions that are shaky. Restoration of HUSKY parents’ coverage depends on a new opioid prescription tax. State insurance subsidies for low income consumers depend on restoring the individual mandate to buy insurance, gutted by the federal tax reform act, and collecting penalties from people who don’t comply. Neither revenue source is a sure thing and Connecticut has a very poor history of keeping promises tied to designated taxes or revenues.
A viable public option that lowers the cost of quality healthcare for Connecticut individuals, families and small businesses would be a good thing. But fixing our strained healthcare system will take more. Drug costs have to come down. We have to address fragmentation across the system, embarrassing lapses in patient safety, inappropriate over- and under-treatment, and the social needs that have a profound impact on health. But most of all we need to not mess up what is working. This bill is a great start.
Ellen Andrews, PhD, is the executive director of the CT Health Policy Project. Follow her on Twitter @CTHealthNotes.
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