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California gets started on health-care reform

The states that are resisting the new health-care law are getting a lot of press lately. But on some level, that's a sideshow. The more consequential story is what's happening in the states that are implementing the new law. And here, as is often the case, California is leading the way:

Under two bills that the California legislature passed and Schwarzenegger is apparently expected to sign, the state's exchange authority would have explicit permission to “contract with carriers so as to provide health care coverage choices that offer the optimal combination of choice, value, quality, and service.” That mandate, combined with the bills' other provisions, means the exchange authority would be able to negotiate pretty aggressively over price and quality, excluding plans that don't serve consumers well. That's more or less what corporate benefit departments and the managers of public employee programs, like the Federal Employee Health Benefits Program, do for their members.

A wide array of interest groups, including consumer advocates like Health Access and nonprofit insurers like Kaiser Permanente, support the measure because they believe it will reward quality and help hold down the price of insurance--a verdict that a new market analysis from Citi seems to confirm:

“Limiting the number of companies that participate would seem give the exchange the power to negotiate more favorable terms with the plans as a basis for selection. In addition, the legislation appears to put significant focus on premium rates, with measures in place for premium rate reviews that will attempt to limit the magnitude of future rate increases.”

This, much more so than the early consumer protections, is what the beginning of health-care reform looks like.

By Ezra Klein  | September 28, 2010; 1:47 PM ET
Categories:  Health Reform  
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Comments

What we have to think is if CA adopts HCR well and few other states follow that (in addition to MA); will it help to institute some better politics nationally which eventually other states will move adopt to? With more than 10% of USA population in CA, it is a big a deal if CA continues this march...

What is Whitman saying? Did she not sound against at least few provisions of HCR? Is Brown using that against her then?

Posted by: umesh409 | September 28, 2010 2:57 PM | Report abuse

Could we see people with health problems moving from resisting states to implementing states?

Posted by: DaveoftheCoonties | September 28, 2010 3:32 PM | Report abuse

That mandate, combined with the bills' other provisions, means the exchange authority would be able to negotiate pretty aggressively over price and quality, excluding plans that don't serve consumers well.


Really? The exchange authority does not negotiate directly with providers? All you're doing is providing a marketplace to make it easier for consumers to shop (if they understood it and accessed it easily). Nice but not meaningful.

Posted by: visionbrkr | September 28, 2010 4:01 PM | Report abuse

"Could we see people with health problems moving from resisting states to implementing states?"

Maybe some, but I'm always amazed at how resistant people can be to voting with their feet. I can think of at least half a dozen states that I see no reason whatsoever to live in, yet people continue to live in them.

Posted by: Virginia7 | September 28, 2010 4:29 PM | Report abuse

"And here, as is often the case, California is leading the way:" to bankruptcy.

Over the last decade, California has lead the nation in net out migration by the middle class. It is only growing population wise due to illegals. Expect the trend to continue as long as socialists control the state leg...

Posted by: illogicbuster | September 28, 2010 5:44 PM | Report abuse

In respect to Employer mandates, it appears from www.BenefitsManager.net and www.AHealthInsuranceQuote.com analysis that employers nationwide will be assessed a $2,000 penalty for every employee not offered group health insurance or commonly referred to employer sponsored health insurance. Does this include part time employees that traditionally didn’t qualify or buy health insurance in the first place because of the cost vrs. Hours worked? How in the world is an employer going to absorb this cost? So if an employee doesn’t want to participate in paying their share, the employer is penalized $2,000?

Posted by: mikeoliphant | September 29, 2010 12:44 PM | Report abuse

In respect to Employer mandates, it appears from www.BenefitsManager.net and www.AHealthInsuranceQuote.com analysis that employers nationwide will be assessed a $2,000 penalty for every employee not offered group health insurance or commonly referred to employer sponsored health insurance. Does this include part time employees that traditionally didn’t qualify or buy health insurance in the first place because of the cost vrs. Hours worked? How in the world is an employer going to absorb this cost? So if an employee doesn’t want to participate in paying their share, the employer is penalized $2,000?

Posted by: mikeoliphant | September 29, 2010 1:25 PM | Report abuse

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