Overpaying on health? Let's really find out

  • Article by: CAROLYN LAINE
  • Updated: February 22, 2012 - 11:10 AM

A third-party audit of managed-care financial reporting is needed.

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The recent Star Tribune editorial "Is state overpaying health plans?" (Feb. 17) rightly questioned the nearly $4 billion in payments to Minnesota's nonprofit health plan companies for our public health care programs. Absent from the editorial was recognition of the bipartisan work on this issue.

This has been a focal point of my work in health policy since my first election. In 2008, I wrote a bill to limit the margins ("reserves") the health plans can accumulate.

Today, as the editorial detailed, the need for a cap is even greater. I have also presented bills to allow independent auditing and to require a change to generally accepted accounting principles in the plans' financial reports.

The health plans successfully lobbied against each of these measures.

However, the tide is turning. In 2010, Democrats spearheaded legislation to require accurate reporting of the health plans' administrative expenses and passed it into law.

In 2011, Gov. Mark Dayton issued an executive order requiring regular reporting and audits of these health plans, saying "the State needs greater disclosure and accountability of managed care plan spending on health care," calling it "critical for public trust."

And last session, the governor and Human Services Commissioner Lucinda Jesson proposed competitive bidding for public health care programs, a change that achieved nearly $500 million in combined state and federal savings.

This year, before session began, I had a bill drafted requiring truly independent third-party audits. I actively sought Republican coauthors, because I strongly believe that demanding transparency and accountability for Minnesota health care program spending should be a bipartisan effort.

The bill (HF2241) was introduced last Monday, before Tuesday's House Health and Human Services hearing. To date, four Democrats and four Republicans have joined me as coauthors on this bill.

I thank the Republican House chairs of the Health and Human Services committees for holding the hearing last week. That hearing made it clear to all why we must go further.

A truly independent third-party audit is important to gain the information we need to better oversee this large expenditure of $3.8 billion. I now encourage the Republicans to work in bipartisan fashion with those of us who have been pushing for more transparency for a long time.

Republicans and Democrats may disagree about how best to reform our health care system, but neither side can promote effective change without this accurate information.

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Carolyn Laine, DFL-Columbia Heights, is a member of the Minnesota House.

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