Now that the 2008 legislative session is under way, we're learning more about Insurance Commissioner Mike Kreidler's health care plan. Employers beware! From Everett's Herald:
Hoping to speed up the pace of health care reform, the state insurance commissioner has stepped from the bureaucratic supporting cast with a big idea: take over the market for "catastrophic" insurance, guaranteeing Washingtonians have coverage in a health crisis....
Some details are still not certain -- Kreidler dodged questions about the cost of his program -- but it would provide all Washington residents with catastrophic health care coverage that kicks in once medical costs exceed $10,000 in a given year. The plan also would cover some preventative care.
It would cover people up to age 65, when they become eligible for Medicare. People who move to Washington would have to live in the state six months to establish residency, and new residents' pre-existing conditions would not be eligible for coverage for a year. Some people with existing government coverage would be exempt, such as those in the military.
Workers and employers would pay for the program with a new state employment tax, probably 1 percent of gross pay for employees and a sliding scale of 2 percent to 5 percent for businesses, depending on their size.
Any way you look at it, this is bad news for the employer community. But wait. Although Kreidler is floating these ideas now, even he acknowledges his cocept is unlikely to become law in this year's short 60 day legislative session. Seemingly, his eye is on 2009.
Although employers won't find comfort in this scheme, there may have a firewall to stop the plan in its tracks - fedreral ERISA law. From the Herald:
If approved, however, the proposal would likely need a waiver from Congress to skirt federal law regulating employee benefit plans. Without such permission, Washington would face a court challenge, Kreidler said.
Perhaps if President Hillary or President Obama takes the oath of office on January 20, 2009, such a bill might well emerge from a Democrat-controlled Congress and receive a presidential signature. However, I cannot conceive of any of the Republican presidential candidates doing anything with an employee benefit waiver other than vetoing it. More proof that national elections have big consequences at the state and local levels.
Perhaps the biggest question one is left with after looking at Kreidler's wish list is this: Why, while Gov. Gregoire pursues a careful, cautious approach to health care reform, is the insurance commissioner reading from a completely different page?
Don Brunell, president of the Association of Washington Business, said huge plans for overhauling the system are too hasty. He also said plans such as Kreidler's blow past Gov. Chris Gregoire's health policy approach, which Brunell described as "a very methodical, deliberate process to go through and figure out what will work and what won't."
