Lawmakers Look to Address Health Cost Crisis – Thank Goodness!

Almost exactly one year ago, we started writing about North Carolina’s worst-in-the-nation health care costs. “And what does the most expensive care in the nation get us? The third WORST overall health care,” we wrote last January.

The problem is two-fold. One, protectionist schemes like “certificate of need” all but ensure supply for medical services is too low to meet demand. This imbalance causes prices to go up.

Two, a litany of state laws mandate, by order of the government, that health insurers must cover this or that medical service, and that health insurers can’t engage in various cost-saving efforts.

Many of these mandates have sympathetic rationales behind them. But this reality has gotten lost in the policy discussion: Every mandate increases health costs for everyone else.

We don’t think that cost-benefit analysis has gotten much attention, and that’s a problem. The net result is North Carolina now has the highest health care costs in the entire country.

This week, state lawmakers are working to do something about it. The Senate Health Care Committee, led by Sens. Amy Galey, Benton Sawrey, and Jim Burgin, will hear Senate Bill 24 on Wednesday.

The measure requires one health care mandate to be repealed for every new health care mandate added to state law. It also requires any new mandate bill to also apply to the State Health Plan, and to contain appropriations to the State Health Plan sufficient to cover the cost of that mandate to the Plan.

This is excellent policy. First, it acknowledges the obvious reality that North Carolina’s health care laws have gotten out of whack. Ranking worst in the country for health costs makes that clear. A new one-for-one mandate policy is a great first step in getting us back to some workable balance.

Second, North Carolina is itself a massive employer, and like other large employers, North Carolina pays for health care for its employees. It’s only right that coverage mandates placed on insurance plans for other employers also include the State Health Plan.

After all, lawmakers are well within their rights to say, “Hey, North Carolinians who need this medical procedure will not have to pay for it out of pocket. Employers will pay for it through their health insurers.” But it’s not okay to pass a law forcing a mandate on everyone else except the state itself! And requiring an appropriation to the State Health Plan to pay for new mandates means the state will not exempt itself from the same pain felt by other employers.

Three cheers for the lawmakers working to fix North Carolina’s abysmal health care cost crisis.