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HMO bill's costs debated

April 08, 1997
By: Angela Greiling
State Capital Bureau

JEFFERSON CITY - A fiscal estimate for the managed care regulation bill put government costs much higher than supporters had expected.

The House gave its final approval to the bill Tuesday, so it will now move to the Senate.

The staff say expanded rights granted to HMO consumers will drive up government's cost of medical care for those on welfare that is provided through managed care companies.

An amendment added to the bill on the House floor would require managed care providers to offer their customers a "point-of-service" (POS) coverage option. That means patients would, for an extra fee, be able to go directly to a medical specialist without being referred by a primary care physician.

Legislative staff say that requirement cover the state Medicaid program, called MC+.

Federal law, however, dictates Medicaid recipients cannot be made to pay a co-payment for medical care. Therefore, if MC+ were required to offer its Medicaid patients a POS option, the burden of any additional costs would have to be absorbed by the state.

Legislative staff report that portion of the bill would add more than $26 million to the annual cost of implementing the changes, making the total $37 million.

The bill's sponsor, Rep. Tim Harlan, D-Columbia, argues the POS provision was never intended to apply to the MC+ plan, and said he didn't expect the fiscal note to interpret it that way.

"I was surprised because I thought the interpretation was clear," Harlan said. "We made it clear that there is an additional co-pay and an additional premium for the POS."

Since MC+ does not use premiums or co-payments, the POS requirement does not apply, Harlan said.

He said there are plans to add a line to the Senate version of the bill to make that more explicit.

Because of the bill's price tag, Harlan had to present it to the House Budget Committee Monday before it could come to the final formal vote on the floor.

Chris Long, president of Associated Industries, a business lobbying group that opposes the bill, said the proposal is still too costly.

"There is still a lot of confusion with how much (the bill) is going to cost," Long said. "If the debate goes on like this, we're just going to roll the dice and see who's right."