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Employer-Based
Health Care
The Case Against Mandates - Look Before You Leap!
The Ohio
General Assembly continues to revisit the issue of mandating that certain
benefits be included in all health insurance plans. During the last
two sessions, lawmakers have considered legislation mandating specific
insurance benefits for: diabetes, maternity hospital length of stay,
birth control, osteoporosis, infant formula and mental health parity.
Ohio law currently mandates that health insurance plans include benefits
for more than 20 specific health problems.
Although each mandate may be viewed as an attractive, expedient solution
for a particular health problem, the cumulative economic and non-economic
cost of these mandates is staggering. Moreover, some mandates lack the
clinical studies verifying that the procedure improves patient health.
Before the Ohio General Assembly enacts additional mandate bills, legislators
should consider the following information relating to the actual impact
of mandates on insured Ohioans.
- Mandates
increase the cost of health insurance for families and businesses.
Employers provide health benefits voluntarily as part of an overall
employee incentive package. In fact, the payment for health related
benefits makes up the largest portion of the total employee benefit
expenditures - costing approximately $4,000 annually per employee.
Health care
mandates passed at the state level cost the average family between
$525 and $1,050 a year. The National Center for Policy Analysis estimates
these mandates increase costs for the typical small business employing
25 people by roughly $20,000 a year. Other studies have shown that
as mandates increase, so does the cost of health care benefits.
If increased
government regulation continue to force up health care costs, real
wages will decline, the increased costs will be passed onto employees,
or the employer will simply discontinue the benefit. In the end, mandates
hurt the very people they are meant to help - individual employees
and their families.
- Mandates
don't improve health care quality.
Real health care quality is about improving medical outcomes - not
legislating who pays for the care.
The policy
question to be considered should be: How can the quality of health
care be improved? The answer lies with reduced government interference
and increased incentives to hold providers and insurance companies
accountable for the quality of care and the level of service provided
to those covered under benefit plans. With better information on provider
and insurance company performance, the health care marketplace will
remain highly competitive, innovative and focused on providing the
highest quality of care for the best price.
- Mandates
drive up the number of uninsured Ohioans.
It is estimated that approximately 20 percent of all Ohioans currently
have no health insurance. Every time a mandate is passed it raises
the cost of insurance. Congressional Budget Office Mental Health Parity
estimates indicate that for each 1 percent increase in premiums, some
200,000 Americans lose their coverage. In addition, one in five uninsured
Americans lack health insurance because of benefit mandates. There
is no doubt about it - mandates increase the number of uninsured.
Think About
It!
As major providers of jobs in Ohio, employers must ask legislators to
please "look before you leap" when considering legislation that mandates
certain health care benefits. In today's global marketplace, the cost
of labor is a key component in determining a company's profitability.
Increased health care costs that do nothing to improve quality or expand
access to care don't make sense. |
