HMSA regulation plan fading
By Kevin Dayton
Advertiser Capitol Bureau Chief
Support for a bill to allow the state to control health insurance rates charged by HMSA and other insurers appears to be eroding, with advocates yesterday asking the public to call lawmakers to keep the plan alive.
Some supporters of rate regulation had hoped the House would agree to amendments by the Senate to House Bill 1761, speeding the bill to Gov. Ben Cayetano. That would skip the step of a House-Senate conference committee, where many bills die when representatives of the House and Senate fail to agree on specifics.
With only four days left to pass the bill, that sort of an agreement now appears to be unlikely. Although the House approved a bill in February almost identical to the Senate proposal, House Speaker Calvin Say said many Democrats only voted for the measure then to "continue the discussion."
The bill would require HMSA and other insurers to submit their rate filings to the insurance commissioner, and would allow the commissioner to reject those rates if they are deemed to be too high, too low or discriminatory.
Many Democrats now have concerns about the whole rate regulation idea, and the issue may have to wait for an audit of HMSA, which has not yet been released by the state insurance commissioner's office, Say said.
"Why would I want to jump into the fire not knowing if ... (HMSA's rates) are excessive or not?" said Say, D-18th (Palolo, St. Louis, Kaimuki). "For me, I'm very much concerned about jumping into the fire and then trying to retract if that becomes necessary. Just like traffic cameras."
Some Democrats are also worried that if the state takes on rate regulation, it would have to guarantee that HMSA makes a profit, Say said.
"The question will be, once you regulate, is it then the state's responsibility to determine the rates for the provider of services? That's the scary part," said Say.
Richard Miller, University of Hawai'i law professor emeritus and spokesman for the Citizens Against Health Care Monopolies, said the bill is one of the few "consumer-oriented bills" still alive at the Legislature.
"We believe the state, because it requires businesses to purchase health insurance, has a parallel obligation to ensure that the rates are fair," said Miller. He said that obligation becomes even more compelling when the largest health plan, HMSA, is a "virtual monopoly."
Turning out to show support for the bill were leaders of the ILWU, the Hawai'i State Teachers Association, Local 5 of the Hotel Employees & Restaurant Employees Union, former lieutenant governors Tom Gill and Jean King and former state Democratic Party chairman Richard Port.
Stacy Evensen, HMSA's vice president for community and government relations, said more state oversight won't reduce costs. In fact, she said, states with rate regulation have insurance premiums "much higher" than Hawai'i premiums.
Rate regulation is supported by Cayetano and state insurance commissioner Wayne Metcalf, but Evensen said the public shouldn't allow it.
"That is where we simply have to draw the line," she said. "To give to a political appointee the ability to control rates in this state is not something this community should tolerate."
