Fewer Mandates = More Affordable Coverage

MOUNT PLEASANT, IA – In trying to help those Americans who do not have health insurance, is the answer more government involvement or getting the government out of the way?  The state of Florida is implementing a plan that will test the latter theory — by allowing Floridians to purchase health insurance exempt from the many government-imposed coverage mandates that have driven up the cost of health insurance.

Health insurance mandates require insurance policies to cover certain types of care or providers of care in every health insurance policy sold, even if the consumer does not want or need that coverage.  Insurance companies are setting health insurance premium rates to cover all mandates on all policies, whether or not the policy holder ever uses the services, which drives up the cost of health insurance for all consumers.  The Council for Affordable Health Insurance estimates that “mandated benefits currently increase the cost of basic health coverage from a little less than 20% to more than 50%, depending on the state and its mandates.”

The “Cover Florida” plan allows insurance companies to sell “no frills” health insurance policies that are exempt from many of the nearly 50 mandates the state would otherwise impose, and are designed to cost $150 or less per month.  The “Cover Florida” plan will be implemented beginning next year.

While “Cover Florida” policies would not cover all of the mandates that the state currently requires of insurance policies, “all benefit plans would include, at the very least, coverage for preventive services, screenings, office visits, outpatient and inpatient surgery, urgent care, prescription drugs, durable medical equipment, and diabetic supplies,” said Governor Crist in a May 2008 press release.

When it comes to mandates, Iowa is better off than Florida , with only 25 health insurance mandates.  This may explain, in part, why 21% of Florida ’s population is uninsured, reports The Wall Street Journal, while Governor Culver reported in a press release last August that only 9% of Iowans do not have health insurance coverage.

Without the “Cover Florida” plan, Florida consumers’ only choices were to purchase “Cadillac coverage” with all the bells and whistles or go without health insurance.  “‘Cover Florida’ will give Floridians another option, providing more choice and lower-cost options to those who wish to purchase health insurance, but could not afford to do so until now,” said Amy Frantz, Senior Research Analyst with Public Interest Institute in Mt. Pleasant, Iowa.

“Fewer Mandates = More Affordable Coverage,” from Public Interest Institute’s FACTS & OPINIONS, is available at www.limitedgovernment.org.

For an interview or more information on this issue, contact Amy Frantz, Public Interest Institute Senior Research Analyst.

A newspaper column on this issue will be released on Wednesday, July 30, 2008.