Rochester Post Bulletin Sen. Franken Op-Ed: In First Year, New Health Care Law Has Worked for Minnesotans
Today, we mark one year since the passage of the nation's new health reform law. Minnesotans can be proud that our state's model of delivering "high-value, low-cost" care has begun to be used across the country to make Americans healthier and to slow skyrocketing costs for families, seniors, and businesses.
The Affordable Care Act has not only begun to get a handle on premiums, it's stopped insurance companies from discriminating against children with pre-existing conditions, allowed young people to remain on their parents' plan until age 26, and begun to fill the Medicare prescription drug "donut hole" for vulnerable seniors who were left on their own when trying to afford the expensive medications they need.
And because insurance companies are no longer allowed to cap the value of the lifetime care they provide, countless Americans have been able to avoid what would otherwise be certain bankruptcy.
We've known for years that preventing people from getting sick is much less expensive than treating them later. That's why the Affordable Care Act requires insurers to provide free preventive services like vaccinations and cancer screenings to keep more people healthy and to lower costs for everyone.
Still other parts of the measure are now being put in place to make our complicated health care system more accessible and affordable for businesses and families, and to cover tens of millions of children and adults who now live without coverage. The long-term savings to our health care system are enormous and will cut projected budget deficits by over $100 billion in the first 10 years and more than $1 trillion in the decade after that.
Leading up to the health care debate, I held 15 listening sessions with Minnesota medical experts from places like the Mayo Clinic and University of Minnesota, as well as with health providers, insurers, and consumer groups. I found that Minnesota has long provided efficient, high-quality care less expensively than the rest of the nation. As one health care economist told me, "in Minnesota we get an ‘A' - of course, that's because we grade on a curve," I'm proud that there's a lot of Minnesota in the new law, and as we continue to improve the delivery of health care in our state, the rest of the nation will improve with us.
During the debate I successfully added a provision called the "medical loss ratio" (MLR), which requires insurance companies to spend at least 80 to 85 percent of health insurance premiums on actual health care services. Not marketing, administrative costs, profits, or CEO salaries. Most Minnesota plans already do this, but in some states, some insurers spend an unbelievably-low 30-40 percent of their revenue on health care.
Because of my provision, insurance companies now are required to report the exact percentage of their revenue that they spend on health care. And beginning next year, companies failing to meet the law's threshold will have to provide refunds to their customers for the amount they were overcharged.
At a Senate hearing last week, two witnesses told me that there's already evidence that the MLR provision has forced insurance companies to better invest in the health of their policyholders, moderate premium increases, and give consumers an overall better value for their premium dollars. Yet even now, insurance brokers are trying to exempt themselves from the law's requirements and gut the effectiveness of this common-sense measure. I'll be standing up for families and small businesses by fighting to stop these efforts in the months ahead.
The law is chocked with cost-saving measures that get little attention. With Indiana Republican Senator Richard Lugar, I coauthored a diabetes-prevention measure based on a pilot program conducted in Minnesota by the Centers for Disease Control and Prevention (CDC). After giving pre-diabetics 16 weeks of nutritional training and memberships at the local YMCA, the CDC found that 60% fewer became diabetic. When this program is scaled up nationally, it will bring down health care costs significantly in every state.
In 2014, we will open Health Insurance Exchanges-marketplaces where health plans will compete to provide quality care, and where people can compare different plans, choosing the one that best fits their needs. The Exchanges will create more choices for people who want to change health plans, and provide assistance for working families who want to keep the health plans they have.
That's what the new law is about-keeping insurance companies accountable to improve care and lower administrative costs, giving doctors and nurses incentives for providing high-quality care, and giving families better value for their health care dollar.
As the Affordable Care Act is fully implemented in the coming years, it will continue to benefit families in Minnesota and across the country, and our state can be proud that it served as a model for doing health care right.