Health exchange deal proposed

The insurance commissioner suggests a board makeup that limits the state's leading insurer's role.

Staff WriterMarch 9, 2011 

— The state's largest health insurer would not have a vote in how North Carolina's anticipated health insurance exchange is run, under a proposal state Insurance Commissioner Wayne Goodwin took to lawmakers Tuesday.

Goodwin told a House committee that his plan is a compromise between two competing bills that would either put Blue Cross and Blue Shield of North Carolina on the board that would oversee the exchange or keep the company off. Consumer advocates have accused the company of orchestrating the legislation that would have given it a seat, but the company denies that.

Under the federal health care overhaul passed in Congress last year, states are required to establish a marketplace for people and small businesses to buy insurance by 2014, or else let the federal government do it for them.

Goodwin proposed a streamlined board of seven voting members with expertise in the fieldand an additional seven nonvoting members. The seven voting members could not have any ties to the various interests involved, and the board would be subject to the state law requiring its meetings and records be open and public, in addition to having an annual audit.

"I believe it's a good and better compromise," Goodwin said after the meeting. "It doesn't guarantee anyone a seat, but it does allow everyone to be able to hear all the voices in a public meeting."

Still, the proposal from Goodwin, a Democrat, could face an uphill battle if it doesn't win the blessing of Republican lawmakers and Blue Cross, which is known for its political muscle.

Under his plan, the state insurance commissioner would appoint four members, and the governor, Senate pro tempore and House speaker would each appoint one. The members would need to be experts in areas such as health coverage, law or finance. The insurance commissioner and the state Medicaid director or their designees would serve as nonvoting members, as would representatives elected from each of five advisory committees representing insurers, employers, consumers, agents and health care providers.

Leadership praised

At least one consumer advocate welcomed Goodwin's proposal. Adam Linker, a policy analyst with the N.C. Justice Center, said the provision to build a board with experts who don't have conflicts of interest is encouraging. He said a broader consumer group, N.C. Health Access Coalition, wants to look at Goodwin's proposal as a group before deciding whether to support it.

"He's really showing leadership on the issue, which is desperately needed right now," Linker said.

Rep. Verla Insko, a Chapel Hill Democrat who has written a bill that would keep all insurance company representatives off the board, called Goodwin's plan intriguing. After the committee meeting, she said that some consumer advocates have opposed having insurance industry board members even without voting powers.

Insko said a lot more discussion is needed on consumer protections in the marketplace, but first the issue of how the marketplace is governed will have to be decided.

"It's the big issue, because if you don't have that right, you won't get anything else right," she said. "We also have to make sure premium costs don't get out of control, and that we not end up with sick people inside the exchange and healthy people outside. The exchange is where the tax dollars are."

The state's insurance exchange would initially be funded with the $145 million in federal money that is currently going to a high-risk pool for the uninsured with pre-existing conditions. The exchange is supposed to be self-sustaining by 2015.

GOP reservations

Rep. Jerry Dockham, a Denton Republican and former insurance agency owner, sponsored the competing bill that would have guaranteed Blue Cross and Blue Shield a spot on the board. After Tuesday's meeting, Dockham said Goodwin's presentation was a good starting point, but he has reservations that the proposed advisory committee's structure might be unnecessarily complicated.

"I always want to take into consideration what the commissioner of insurance says," Dockham said. "He made some very good points. I'm going to work with him to try to work out a solution."

Blue Cross spokesman Lew Borman said the company would withhold comment until it had a chance to review Goodwin's proposal in writing.

Goodwin said his recommendations were the result of seven months of study by an N.C. Institute of Medicine task force, which he and Health and Human Services Secretary Lanier Cansler co-chaired, and an internal Department of Insurance task force. He said more than 200 people participated in the process. or 919-829-4576

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