Lobbies back Pawlenty on health care bill

The state's two major business lobbies are urging Minnesota House and Senate negotiators to approve a health care reform bill that will meet the budget-balancing test set last week by Gov. Tim Pawlenty.

The Minnesota Chamber of Commerce and Minnesota Business Partnership support Pawlenty, who said he wants to sign a bill that will drive anticipated cost cuts without adding more Minnesotans to a state-subsidized health plan for uninsured workers and small-business people who can't afford private-market insurance. The lawmakers are set to resume deliberations over the health care bill today.

Pawlenty has proposed holding the line on liberalizing eligibility to the MinnesotaCare program and taking $125 million in reserves from a state health-care access fund (which could be used for MinnesotaCare) to help balance the $950 million budget shortfall forecast through June 30, 2009.

Sen. Linda Berglin and Rep. Tom Huntley, Democratic chairs of the key committees overseeing health care reform, oppose using the health-access funds to balance the budget. Pawlenty has countered that he otherwise might cut programs by a similar amount that cover the poor and uninsured.

"If they expand MinnCare, the health care access fund will be in trouble in just a few years," said Beth Hartwig, health policy director for the Business Partnership, which represents the state's largest employers. "The DFLers are making the assumption that the reforms will save us money in the long term. ... The business community wants more individuals to get access. We would argue that the private sector can do that. We think these reforms will help us contain costs and allow for private-sector insurance to provide more coverage through employers."

The number of Minnesotans covered by employer-sponsored insurance has dropped from 68 percent to 63 percent over the last five years, as some companies abandoned plans amid double-digit jumps in annual premium expenses.

Health care costs are also the fastest-growing component of state and federal budgets, including Medicare and Medicaid.

Huntley expressed hope in recent days that a compromise could be found that would preclude a veto. Most stakeholders say the legislation may be one of the last hopes to slow cost increases. The bill resulted from a bipartisan task force of business and health care executives, legislators, nonprofit, labor and education officials, and Cal Ludeman, Pawlenty's commissioner of human services.

The legislation is designed to deliver on the task force's mission to find ways to cut the state's projected $57.4 billion health care tab by nearly 20 percent by 2015.

Changing incentives

Essentially, the task force report advocates moving from a system based on disease treatment, where doctors are paid by procedures and visits, to a prevention-focused system that also streamlines and improves disease management for the 20 percent of those patients who drive about 80 percent of the system's cost.

An improved system would get about half its savings by rewarding providers for the most economical and beneficial results of improving patient health care over time for prices and costs that will be transparent and posted. Other savings would come from administrative efficiency and more focus on combating chronic conditions such as obesity, smoking and alcohol.

Consumers, who increasingly are paying through higher deductibles and copays, also would be encouraged to take better care of themselves and take less-costly generic drugs.

Pawlenty, who has endorsed most of the reforms, noted that Minnesota already insures 93 percent of its people through private or public programs. He also has raised concerns about the ability of small rural clinics to compete with major hospital complexes, including Allina, which supports Huntley's bill.

Berglin has charged that Pawlenty, in the interest of a short-term budget fix, is backing away from a disputed commitment to let her use MinnesotaCare to cover about half the Minnesotans who currently lack coverage.

The business lobbies stand squarely behind Pawlenty.

Critics, who support a single-payer, universal system, argue that this is just another attempt to tweak a provider-driven system of drug companies, medical device makers, hospitals and for-profit clinics that costs about double that of France or Canada as a percent of economic output. Those countries spend less but boast populations as healthy as the United States.

That argument won't get settled this week. But it's a good idea for legislators and the governor to come up with a compromise that can move forward these reforms.

Neal St. Anthony • 612-673-7144 • NStanthony@startribune.com