There Is Hope

Health care was one of the hottest topics at a conference in Washington this week on Women Entrepreneurship in the 21st Century, sponsored by Labor Secretary Elaine Chao and attended by more than 1,600 women business owners from around the country.

During the first general session, women said in an electronic poll that the high cost of health insurance was by far (76%) their greatest concern. White House advisor Anne Phelps outlined President Bush’s health agenda, which the president himself addressed the next day. The proposal to create association health plans to give small businesses better purchasing power received the biggest applause each time.

I moderated two workshop sessions on health care, and the anger and frustration over the high cost of health coverage reached a near fever pitch. Two self-employed women in their 50s from New York and another from New Jersey were the angriest of all – feeling powerless against the forces of mandated benefits, guaranteed issue, community rating, and other laws that make health insurance cost as much an apartment in Manhattan.

Greg Scandlen of NCPA, Victoria Braden who owns a health benefits firm in Georgia, Bob Fahlman of eHealthInsurance, and actuary Mark Litow of Milliman USA made up the panel. They explained the pressures and forces that keep the health insurance industry from operating as a real market.

The women are desperate for solutions and were particularly interested in discussions of defined contribution models, medical spending accounts, rollover of Section 125 flexible spending accounts, tax credits, MSAs, and other market-friendly reforms.

Politicians, beware. Their anger is palpable. These women are demanding solutions to the problems plaguing the most heavily regulated sector of the American economy.

Separately, I testified via conference call on Wednesday before the Vermont House of Delegates’ Health and Welfare Committee, chaired by Rep. Tom Koch.

I praised Chairman Koch for taking the lead in drafting legislation to reform Medicaid to give some recipients vouchers that they can use to buy private insurance, including their employer’s coverage. Other witnesses talked about the need to relax the state’s community rating law to attract insurers back to the state so there can be a real market for an estimated 30,000 to 50,000 Vermonters who would be eligible for the vouchers. Still other witnesses testified to the remarkable creativity of the private marketplace in somehow managing to operate in spite of often perverse, damaging, and counter-productive state health care regulations.

There is hope.

Grace-Marie Turner

Grace-Marie Turner is president of the Galen Institute, a not-for-profit research organization focusing on ideas to promote free-market health reform. She can be reached at P.O. Box 19080, Alexandria, VA, 22320.

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