Lawmaker's plan aimed at lowering high health costs
1:06 AM 10/27/03

if you want company, start complaining about HMOs. <

There's no shortage of ill feelings when it comes to HMOs, PPOs, managed care and all the other alternatives to traditional fee for service health-care insurance which allows patients to choose any physician to treat them. <

Criticizing the system is a lot easier, however, than enacting alternatives. Just ask Hillary Rodham Clinton. During her husband's first term as president, she headed up a much publicized panel to reform health care only to fail and fade away as a policymaker when having to go toe to toe with the health-care industry. <

Supporters of managed care insist that, in the long run, it lowers costs. It's an argument often challenged in light of continually rising costs. In state government here in Wisconsin, a 12 percent annual increase in health insurance costs for employees was hailed as a good deal. <

The point made by managed care is that the increase would have been a lot more without HMOs leading the way. <

Rep. Terese Berceau says the HMOs have not made a case for lowering costs. Berceau, D-Madison, wants to open up HMOs to any physician willing to abide by the terms and conditions of the plan. Her plan is opposed by the state's recognized expert on health insurance matters. <

Tom Korpady, the administrator of the Division of Insurance Services at the Department of Employee Trust Funds, says Berceau's plan will drive up costs significantly. Berceau's "Any Willing Provider" proposal is sure to receive a warm reception from consumers, at least until costs are determined. <

The perception is that it would offer the best of both worlds. One the one hand, Berceau's proposal would offer the benefits of an HMO plan (lower premiums compared to the traditional fee for service plans) and the obvious benefit of the fee for service plans, mainly a wider selection of docs. <

Berceau said she offered her proposal to help people in areas of the state where there are a limited number of HMOs. <

"This is a real problem for people in rural areas," Berceau said. "People must change physicians to stay in an HMO plan. This is especially harmful for people suffering from mental illness and other chronic diseases in which a continuity of care is critical." <

Berceau said she is not buying the idea that HMOs hold down costs. <

"There's no evidence, is there, that the current system is holding down costs," she said. "HMOs always argue that changes will drive up costs, but costs are going up anyway. Where's the savings?" <

Korpady said the savings are evident right in Berceau's back yard. <

"In Dane County, we have two major HMOs competing, Dean and Group Health," he said. "The result is that annual costs went up 7.35 percent in Dane County compared to 12 percent statewide. I might add that a 12 percent annual increase is very good when compared to other states and a 7.35 percent increase is one of the best deals around." <

The Dane County experience contrasts sharply with Milwaukee County, Korpady said. <

"An 'Any Willing Provider' system already exists, essentially, in Milwaukee County," Korpady said. "A recent Mercer study indicated that Milwaukee County rates are some of the highest in the country. <

"It's a fact that competition keeps costs down," Korpady said. "You have aggressive competition in Dane County, and the costs are much lower than Milwaukee County where the plans are virtually wide open." <

HMOs can hold down costs because they can assure a select group of providers a certain patient pool, Korpady say. <

"Without that assurance, the costs are going to go up, because the coverage must be, in effect, universal," he said. <

Moreover, the allegations of HMO abuses haven't surfaced in Wisconsin, Korpady said. <

"I just haven't seen that here," he said. "What I have seen is savings, and I think that an 'Any Willing Provider' plan would drive up costs higher. It's just not a good plan for Wisconsin." <

Berceau, whose Assembly district includes state workers benefiting from HMO plans that require no employee contribution, said her proposal focuses on choice. <

"I'm looking out for the consumers," she said. "There needs to be an alternative for people forced to drive long distances to see a physician or people who need to stay with the same physician. It's a proposal for better health care." <

Berceau's proposal has not reached the bill stage yet. She is circulating the plan among colleagues to gather co-sponsors. <

Stan Milam, of Capitol News Service, has covered state government since 1983. He can be reached at 608-251-8585; send e-mail to cns@chorus.net.