LANSING – A new Michigan coalition consisting largely of business, labor and healthcare organizations launched Wednesday to promote legislation reforming rules for individual health insurance in the state.

Consumers for Fair and Affordable Insurance Reform argued that a package recently passed by the House (HB 5282 and HB 5283 ) ensures that those not able to obtain group health coverage through an employer would still be able to get, and keep, coverage.

The bills have so far pitted Blue Cross Blue Shield of Michigan, one of the members of CFAIR, against the other health insurers in the state. The Blues has argued the changes in the bills are necessary to allow it to keep rates down, but opponents have argued they are a route for the Blues to capture the entire healthcare market in the state.

Rob Fowler, president of the Small Business Association of Michigan and chair of CFAIR, said the bills provide many of the same changes in the individual market as were made for small groups some four years ago. And he said bringing the rules for small groups and individuals together is important as the lines between the two markets blurs.

“More and more sole proprietors are getting insurance in the individual market,” he said. “As small businesses are dropping health insurance, they’re trying to help their employees get into the individual market.”

But he said the current rules allow most private insurers to drop their more expensive customers, pushing those people on to Blue Cross, which, as the insurer of last resort, cannot reject them.

“Two things can’t happen: people can’t wait until they get sick to get insurance and insurers can’t wait until people get sick and then dump them,” Fowler said. “The rules in the state allow someone to get sick and be dumped. They also allow someone who’s young and healthy to get pulled away from a larger pool.”

Linda Teeter with Michigan Citizen Action said the bills were essential to ensuring access to health insurance for residents given the growing cost of care and the shrinking number of employers providing coverage.

And to the arguments that the proposed changes would shift more of the market to the Blues, Fowler said the same arguments were made about the small group market changes, but a recent survey by the Office of Financial and Insurance Services found there were more competitors and that the competitors had a larger share of the market than they had before the new laws.

Fowler indicated his organization would accept a requirement in the bills, such as there was in the small group bills, to require such an audit of the market after three years. But John Truscott, executive director of CFAIR, said the coalition had not discussed or agreed to any amendments to the bills as passed the House.

Opponents of the bills appear ready to strike back with release Friday of a report on the Blue’s role in the current insurance market. While the report itself is not intended to be biased, it was commissioned by opponents of the legislation and officials said the report shows Blue Cross is not in the tough financial straights it has claimed to spawn the proposed changes.

The bills are expected to begin working their way through the Senate in the coming weeks.

This story was provided by Gongwer News Service. To subscribe, click on Gongwer.Com

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