Mandates, which govern protections, become issue in heath care reform fight

If you’re a single man in your 20s with health insurance purchased individually or through a small company, you’ll be glad to know you’re covered for mammograms.

And for reconstructive surgery after breast cancer.

And the vaccine that prevents cervical cancer.

If you’re a young, single woman, don’t sweat — you’re good if you ever need screening for prostate cancer.

Those treatments are just some of the health insurance mandates Nevada requires insurers to package into individual and small-group policies they sell here. Big groups and large, self-insured companies are exempt, but their policies cover most mandates, anyway.

The mandates govern what conditions, providers or dependents each comprehensive policy sold here must cover.

Nevada has 44 mandates, ranking it No. 24 among the states, according to the Council for Affordable Health Insurance in Alexandria, Va. Rhode Island has the most mandates, with 69. Idaho ranks last, with 13 mandates.

Other mandates include coverage for contraceptives, autism, clinical cancer trials, drug-abuse counseling and hospice care.

Mandates have become a flash point in the debate on health-insurance reform. Detractors say mandates drive big premium increases that price individuals and small businesses out of insurance markets, while supporters counter that covering more people for more illnesses is both a moral imperative and a smart fiscal move that encourages preventive care.

There’s little debate about whether mandates add costs to premiums. They do. The question is how much, and whether that effect is reasonable. Sure, part of the purpose behind insurance is to spread unexpected costs among a broad pool of people to curb the risk of financial loss. But some observers say roping in people at no risk for certain diseases unnecessarily boosts everyone’s premiums and puts health coverage out of reach for thousands of Nevadans.

THE COST OF MANDATES

Monthly individual premiums in the state cost anywhere from the mid-$200 range to the upper $300s for adults in their 20s and early 30s, according to the Nevada Division of Insurance. For adults in their late 30s and early 40s, monthly premiums are even higher — $400 or more. Seniors’ individual plans can cost $600 or more a month.

J.P. Wieske, executive director of the Council for Affordable Health Insurance, said research shows mandates are behind 10 percent to 25 percent of those premiums, depending on the state and the mix of requirements. Nevada health insurers privately say the state’s average-size mandates account for 10 percent to 20 percent of policy premiums for small businesses and as much as 15 percent for individuals.

Most individual mandates contribute less than 1 percent to premiums, but they add up, Wieske said.

By the council’s estimate, Nevada’s 44 mandates are behind at least 19 percent of the cost of Silver State comprehensive health insurance premiums. Topping the expense list at 5 percent to 10 percent is mandatory mental health care coverage, which must be offered on par with physical therapy for an injury.

Gary Shippey, an actuary with the life and health section of the Division of Insurance, said Nevada’s coverage prerequisites add about 10 percent to premiums for individual plans sold in the state. The division doesn’t regulate group insurance rates.

Pile on federal mandates, and Nevada’s insurance costs rise even more. A new federal law that strips pre-existing condition exemptions out of individual coverage for children adds as much as 25 percent to premiums on new policies for kids, Shippey said. Another requiring preventive wellness benefits added more than 13 percent to new plans.

Mandates can also drive up health care costs. Consider acupuncture, required in Nevada with every comprehensive plan. More people will sidestep cheaper treatments such as pain pills and go for pricier acupuncture just because it’s paid for, Wieske said. Add 1 percent to 3 percent to the premium’s bottom line.

Both Wieske and Shippey noted that premium impacts can vary by plan. A higher deductible blunts some of the effects, for example.

Still, any price hike means fewer people can afford insurance — a big problem in a state where more than 20 percent already lack coverage, according to the Census Bureau.

Wieske said that for every 1 percent jump in premiums, 200,000 more Americans can no longer afford coverage.

"You’re basically talking about companies with workers making $8, $9 or $10 an hour. It’s hard for them to afford insurance from the get-go," he said. "And those are the people being hit by mandates."

ENCOURAGING PREVENTIVE CARE

But health-care affordability is already a big problem for society’s neediest patients, and that’s why coverage requirements are so important, mandate supporters say.

"The cost of health care, especially coverage of certain conditions such as autism, can be extraordinary, so health insurance companies decide to deny coverage," said Mark Olson, a local publicist who advocates for continued coverage for autism. "But people can’t get treatment because the providers won’t accept them as patients without insurance, and the cost of treatment is often more than people have available in cash."

A 2006 study from the Harvard School of Public Health found that autism care for one patient can cost $72,000 a year. The Centers for Disease Control and Prevention estimates that just less than 1 percent of the country grapples with an autism-spectrum disorder.

Nevada’s autism mandate took effect Jan. 1, requiring comprehensive policies to cover up to $36,000 a year for autism-related care. Notably, the state exempted its own Medicaid program to avoid $30 million in added costs over two years.

A major Nevada insurer said in October that the mandate would add 2.2 percent, or $100 per year, to its premiums.

But it’s money well spent, advocates say. Lifetime custodial care for autistic adults untreated as children could cost more than $3 million, the Harvard School of Public Health said.

"Health insurance was originally designed to help people mitigate the risk of personal financial failure, and in doing so encourage people to better manage their health and keep the need for health care services reduced and manageable," Olson said. "People manage their health better when they see a doctor regularly and catch problems when they are smaller and easier to treat and cure."

That’s certainly the case with breast cancer, said Stephanie Kirby, executive director of the Southern Nevada chapter of Susan G. Komen for the Cure.

Because mammograms are covered, more women are screened and cancer is detected early, when it’s far less expensive to treat. Breast reconstruction is part of the healing process, so it’s also covered, Kirby said.

"When you piecemeal it, people feel as though they’re not healed. They feel like they’ll be living with this disease for the rest of their lives, and essentially, they already are," she said.

And consumers who balk at paying for coverage they can’t possibly use can join the club, Kirby added.

"Do I need coverage for prostate cancer screening? No. But it’s a give-and-take," she said. "We all need insurance coverage."

‘a balancing act’

Many mandates have roots in impassioned appeals made by patient advocates to state lawmakers, and crafting health policy in the political arena can allow emotion to trump science, Wieske said. For example, several state legislatures in the 1990s mandated coverage of bone marrow transplants to treat cancer, but years later the therapy was found to be ineffective in fighting some cancers. In 1997, legislatures were poised to make insurers pay for the diet drug fen-phen when research showed the drug causes irreparable heart damage.

Closer to home, Nevada is one of just four states that still requires coverage for hormone-replacement therapy, even though doctors stopped prescribing it for most women in 2002 after researchers linked it to increased risk for breast cancer, strokes, dementia and heart attack.

Better linkage between science and politically driven mandates could cut the burden on insurance markets and even help push better treatment, said Mike Murphy, president and general manager of Anthem Blue Cross and Blue Shield in Nevada. The insurer is the state’s second-biggest, with 190,000 members.

"Who’s best able to determine whether something is needed or is appropriate care? The best way is to leave it to the private sector, including doctors and hospitals, to work through it and determine what evidence-based treatments deliver lower costs and better-quality care," Murphy said. "In some cases, the mandate system ties doctors, hospitals and researchers to certain approaches and keeps the industry from moving forward."

Politics also affects insurance markets by dictating who will pay for specific treatments, and how those therapies will be covered.

Consider autism. Some of the blame for mandates comes from state budget crunches, which have encouraged legislators to slowly shift therapies away from public schools, where they’ve typically been funded, and onto private insurers, Wieske said.

"The question isn’t whether those children need or deserve society’s help. They do," Wieske said. "There’s no question about that. But autism is an example of the states abdicating their responsibilities because of budget issues, and putting those responsibilities on insurance companies. It’s a balancing act that we have to figure out. Is it fair for an individual to be priced out of insurance markets because of autism mandates?"

Wieske and Murphy both suggested reducing or eliminating some mandates by handling some coverage as riders to basic insurance plans, or letting consumers decide whether they want to pay to cover some specific illnesses. In some situations, though, riders are as impractical as mandates: Autism riders, for example, can cost as much as the $36,000 annual benefit itself.

Wieske also suggested selling tiered plans with varying numbers of mandates, including policies with no mandated coverage, policies with a few of the mandates and policies containing all of the requirements.

Kirby said letting people cobble together their own coverage could leave patients vulnerable to unexpected illnesses.

"You’re getting into dangerous territory when you start picking what you might get down the road," she said. "This is a huge policy issue. I understand we’re all looking to save a few dollars, but in the long run, I think we’d rather save our lives."

Contact reporter Jennifer Robison at jrobison@reviewjournal.com or 702-380-4512.