Opinion: NC House Bill 346 might help lower health care costs, cut through red tape

A bill in the North Carolina General Assembly would cut government red tape so some businesses like Blue Cross NC can more efficiently invest its resources, so long as those investments go toward lowering health care costs, increasing access or improving the consumer experience.

Unfortunately, a small but loud minority has made several false claims against the legislation that would lead one to believe the bill does many things it does not and cannot do.

False claim No. 1 is the bill would raise insurance premiums. Not only have opponents failed to support this claim with facts, but it also shows a fundamentally flawed understanding of how insurance premiums work.

Health insurance premiums are subject to state and federal oversight. Federal law requires that at least 80 cents of every premium dollar be used to pay health care bills for policy holders. If a health plan collects too much money and falls below this threshold, then individuals and businesses get a rebate. No state law can override this. In addition, insurance rates must, and will continue to be, approved by the N.C. Department of Insurance.

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If anything, House Bill 346 will put downward pressure on premiums as investments are made that lower health care costs.

Take, for example, new investments that reduce emergency room use and instead help consumers find appropriate level of care in more affordable setting. By providing people who use an emergency room with access to less expensive sources of care, you can lower the cost of health care.

If health care costs are lower, then premiums must be lower as required by law. This is a good thing for consumers and small businesses who struggle with high cost of care.

False claim No. 2 is individuals and businesses will not get rebates they are owed since those dollars will be used for new investments. Again, this claim shows a lack of understanding about insurance rebates and laws surrounding them.

Rebates are not based on how much a business has in its savings or “reserves.” Reserves are used to pay for unexpected medical expenses, should they arise like during the pandemic. Insurance companies are required by law to keep a minimum amount of dollars in these reserve accounts. Reserves and rebates are not related in the way opponents of the bill have described.

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Rebates are required by federal law if an insurer fails to spend a minimum of 80 cents of every premium dollar on health care. State law cannot change this.

False claim No. 3 says the legislation will weaken oversight and transparency.

There is no language in House Bill 346 that changes the fact the N.C. insurance commissioner maintains all authority to regulate health insurance companies. The bill even goes so far as to say any investments made because of this bill must be publicly disclosed so the state can ensure resources are going towards lower costs and improved access. Ensuring transparency, while allowing better products and services to be offered, is a win for people who buy health care and run businesses in our state.

False claim four is the bill sidesteps decades-old laws causing a blow to small businesses and individuals buying insurance. 

The fact is the bill removes government overregulation so companies like Blue Cross NC can more efficiently use its resources to lower costs, improve access and offer new products and services that consumers demand.  A more efficient setup that lowers costs and provides value to consumers should make sense to anyone who runs a business in NC.

House Bill 346 is backed by Republicans and Democrats. A majority of legislators in both Chambers are behind it.

And why wouldn’t they be?

When you read the bill and examine facts, you quickly find the claims against House Bill 346 are incorrect and uninformed.

The bills authors have made sure that North Carolina consumers are the beneficiaries of this legislation. They have written specifically into the bill that any investments must be made towards improving health care and lowering costs for individuals and businesses.

The members of the General Assembly who support this bill–including Western North Carolina Representative Jennifer Balkcom and Senators Ralph Hise, Warren Daniel, Tim Moffitt and Kevin Corbin–should be commended for doing what is best for their constituents and not falling victim to falsehoods, no matter how loudly and repeatedly they are stated.

Austin Vevurka is Executive Director of the Affordable Healthcare Coalition of North Carolina, a nonpartisan, nonprofit grassroots organization focused on lowering healthcare costs for individuals and businesses in the state.

This article originally appeared on Asheville Citizen Times: North Carolina House Bill 346 may help lower health care costs