Effort to Scrap Health Program is Shortsighted

Our view: Group plan pays for itself, works well for small firms, self-employed

Tens of thousands of Arizonans are in danger of losing good, affordable health coverage because some state lawmakers are choosing to follow ideology instead of practicing common sense.

A bill that has received preliminary approval in the state House would effectively kill Health Care Group of Arizona, a 22-year-old program that pools small businesses and self-employed individuals for the purpose of negotiating lower health-insurance premiums.

The legislation, HB2498, would require Health Care Group to meet the same state requirements as private insurers. One such requirement is that insurers have enough capital in reserve to meet financial obligations.

However, Health Care Group, which since 2004 has been completely self-funded, operates on a different business model. The health providers it contracts with allow Health Care Group to run a deficit, which is paid in full each year when premiums catch up with costs.

Anthony Rodgers, director of the Arizona Health Care Cost Containment System, which oversees Health Care Group, said the health providers are big enough financially that they can let the agency run a deficit for a while.

By using this business model, Health Care Group has been able to meet all its financial obligations without taking a penny of public funding. In addition, the program has grown from providing coverage to 4,500 businesses in 2003 to more than 9,000 today, Rodgers said.

Health Care Group has about 25,600 enrollees, 6,700 of whom live in Pima County, according to Rainey Daye Holloway, chief public information officer for AHCCCS.

So why would lawmakers want to dismantle an agency that provides a vital service to so many Arizonans? In a word – ideology.

Some Republicans in the Legislature, such as Rep. Kirk Adams, the sponsor of HB2498, don’t believe the government should be in the heath-care business. They believe health insurance is best left to the private sector.

“The ideology is that the market will fix everything,” said state Rep. Phil Lopes, D-Tucson, a supporter of Health Care Group. “Our argument is that the private sector has never handled this problem. If we get rid of Health Care Group, private insurers are not going to suddenly come in and cover these people” at an affordable price.

In many cases, the private sector has failed miserably. It is estimated that close to 50 million Americans, including about 1 million in Arizona, lack health insurance. We believe lawmakers should be doing all they can to improve access to insurance, not setting up new obstacles.

Rodgers said that if HB2498 passes, health-care providers would probably stop doing business with Health Care Group because they would be unwilling to forward the agency the reserves it would need to comply with the proposed law.

Health Care Group’s business model is working and lawmakers should not impose a different model that fits their ideology.

Moreover, HB2498 may only make matters worse for the state.

If Health Care Group goes away, many of the 25,600 enrollees will probably be unable to afford health insurance and wind up on AHCCCS, the state’s health-care program for the poor. The state will then be paying to care for people who were previously paying their own way.

The proposed law could also put small companies out of business because entrepreneurs with chronic health problems would have to close shop and find work with a firm that offers health insurance. If businesses go under, tax revenues go down.

Lastly, Rodgers said hospitals would likely have to provide more uncompensated care from Arizonans who would no longer have a way to pay for health services.

State Rep. Steve Farley, D-Tucson, a small-business owner who subscribed to Health Care Group for two years, said claims that the agency is insolvent are untrue.

“That’s categorically false. Health Care Group has never once not paid a claim,” Farley said. “It’s a huge success story for the state, and it’s a model for the rest of the country.

“We should be praising it instead of looking for ways to shut it down.”

Health Care Group provides a vital service for many Arizonans, and it does so without tax dollars. It is well-run and saves health costs that would otherwise fall on society.

We encourage legislators to preserve Health Care Group by rejecting HB2498.

(c) 2007 Arizona Daily Star. Provided by ProQuest Information and Learning. All rights Reserved.