Senate Passes Bill Shifting Health Coverage Costs from Employers to Consumers
April 15, 2003
STATEMENT BY LISA McGIFFERT SENIOR POLICY ANALYST, CONSUMERS UNION
AUSTIN, TX — Following is a statement by Lisa McGiffert, senior policy analyst, Consumers Union, on today’s passage by the Senate of SB 541, a measure that shifts the costs of current “mandated benefits” in employer sponsored health insurance plans from employers and insurance companies to consumers:
“There’s a reason why businesses and insurers love this bill. They’ll be off the hook when it comes to covering key health benefits that the Legislature has deemed important for insurers to cover over the past 20 years. Consumers will pay more for less coverage.
The term “consumer choice” is a PR gimmick to obfuscate what is really going on here. These new “choices” created by SB541 will be tailored for the healthy and wealthy, and are unlikely to help typical uninsured Texans with modest incomes or pre-existing conditions.
In Senate debate, the choices were referred to as “Chevy” vs. “Cadillac” plans. Unfortunately, people can’t control getting “Cadillac” illnesses. People with chronic and acute healthcare needs will be left with huge out-of-pocket costs to pay before their insurance actually kicks in.
Further, the proponents of these bare-bones plans claim they will bring down the costs of insurance but SB541 gives no guarantee that premiums will go down or that they will fairly reflect the cost of stripped coverage. The bill explicitly states that the Commissioner of Insurance has ‘no power or authority to determine, fix, prescribe, or promulgate the rates to be charged’ for these plans. The sponsor pledged to look at the rate issue again next session, but rate oversight should be in place at the onset of the sale of these plans. ”
For more information, please call Lisa McGiffert at (512) 477-4431