Published on NJ.com by Susan K. Livio
TRENTON — With insurance companies in New Jersey fleeing the health exchange created by the Affordable Care Act, a state lawmaker has introduced a bill to create a government-operated plan that he said will stabilize the volatile market.
The “New Jersey Public Option Health Care Act” would require the state Health and Banking and Insurance departments to develop the plans, according to the legislation Assemblyman Reed Gusciora (D-Mercer) introduced on Thursday and announced on Monday.
Any consumer could enroll in the plans, which would compete with those offered by private carriers, according to the bill (A4211). Carriers that already provide Medicaid and Medicare coverage would be eligible to join the public plans.
“Health care should be a right for every New Jersey resident,” said Gusciora (D–Mercer). “I think the climate is finally right to make significant changes to our system that will enshrine that principle in our laws.”
Consumers will have only two health care providers to choose from on the health exchange when the open enrollment period begins Nov. 1. Oscar, Health Republic of New Jersey, and Oxford Health Plans, owned by UnitedHealthcare Co. are pulling out, citing severe losses.
The insurance carriers that remain are the two most dominant, Horizon Blue Cross Blue Shield of New Jersey and AmeriHealth, which together insure more than 80 percent of individual enrollees.
This pattern has played out across the country, as premiums have continued to rise. Nationally, Democrats and Republicans both have talked about the need to amend the landmark healthcare law to address the lack of young and healthy participants, the rising costs and the dwindling insurance players in the market.
President Obama rejected the so-called “public option” when he was crafting the six-year-old law. This summer, however, Obama wrote an op-ed for the Journal of the American Medical Association calling on Congress to amend the law to include a publicly run option, pointing to “public programs like Medicare, (which) often deliver care more cost-effectively by curtailing administrative overhead and securing better prices from providers.”
Guisciora’s bill faces significant barriers. If it passed both houses in the Legislature, Gov. Chris Christie, who would need to sign it in order for the bill to become law and he has shown no interest in getting involved with the health exchange.
Linda Schwimmer, president and CEO of the New Jersey Health Care Quality Institute, a research and consumer advocacy organization, said she appreciated Gusciora’s “good intentions,” but she saw problems with the bill.
“The bill in its current form raises so many legal and practical issues. From our state’s current fiscal status to just how insurance operates, there is a lot that would need to be fleshed out for this to be workable,” Schwimmer said.
“The government has the benefit of representing a large population of people, and that gives them a lot of clout in cost and reimbursement negotiations,” Gusciora said.
“That’s really the need and the goal, here — to cut costs,” Gusciora added. “With this plan, our insured and uninsured alike will have a reliable, affordable option for healthcare, where they can use their existing doctors and hospitals without having to deal with obtrusive and damaging network arrangements.”