Senator Welch: Proposed State-Run Health Insurance Plan Won’t Help Governor Balance Budget [Hartford Courant]

April 6, 2011

Malloy Retreats From SustiNet
By Rinker Buck of the Hartford Courant
Story as it appeared in the Hartford Courant on April 5, 2011

In his strongest statement yet that he has abandoned the SustiNet health care legislation moving through the General Assembly, Gov. Dannel P. Malloy said Tuesday that he “does not think this piece of legislation is the right vehicle” for achieving health reform in Connecticut.

The governor’s statement followed a week during which Malloy repeatedly expressed skepticism about the present SustiNet bill at town meetings across the state. Malloy has consistently said that he supports “the goals” of SustiNet and even attended a rally for the legislation after he was elected governor. But he has gradually backed off from full support of the bill as its financial costs have become clear.

Malloy’s retreat is expected to slow the momentum of the bill in the General Assembly and was met with dismay by health reform advocates, who worry that there is no longer time to rescue SustiNet this year.

To survive, the bill would have to endure the lengthy process of being reworked by the legislature’s public health committee and the four other legislative committees that already have approved it in its present form. The other alternative is the legislature could pass the existing bill and face a likely veto.

Malloy’s change of heart follows a month of controversies that have battered SustiNet. Doctors groups who originally supported the legislation objected to the removal of provisions in the bill that would protect them from malpractice suits. Insurance companies who are opposed to the reforms are heavily lobbying against it. And a report by the legislature’s nonpartisan Office of Fiscal Analysis, released Monday night, said the cost of providing coverage for the noninsured and the poor could cost the state up to $483 million annually in new expenditures.

The objections of Malloy and his advisers are twofold. First, they do not want to add to the difficulty of balancing the state budget by assuming new health care costs for the state. Second, Malloy said he did not want to take the unprecedented step of turning over some $7 billion that the state spends on health care every year to “a quasi-public authority that has almost no accountability to taxpayers.”

Under SustiNet, Connecticut would create large pools of health care users, such as state workers and people covered by the Medicaid and HUSKY programs, to leverage savings on care. The legislation also would centralize and coordinate each patient’s care under one doctor, and create diversified group practices that would lower costs by providing better care and coordination of services to patients. The bill also would create an independent SustiNet board to coordinate health care and create health exchanges that would compete with private insurance.

The bill initially enjoyed strong support among Democrats in the legislature and the Malloy administration, but that has seemed to fade as Malloy began traveling the state to defend his state budget and proposed budget cuts.

When the governor’s office was asked on Tuesday to elaborate on its reasons for backing away from the SustiNet bill, the governor’s aides referred a reporter to Jeannette DeJesus, the deputy commissioner of public health who also is Malloy’s special adviser on health reform.

“The governor believes in the goals of SustiNet, but he does not believe this is the right time,” DeJesus said Tuesday. “We can achieve all of the goals of health reform by taking advantage of federal dollars offered in federal health care reform. This piece of legislation cannot move forward in its present form, and the governor certainly doesn’t want to hand over $7 billion in health care spending to a quasi-independent board, which no state has done.”

Ellen Andrews, executive director of the Connecticut Health Policy Project in New Haven and a longtime supporter of the SustiNet bill, said that she wasn’t calling the reform “dead on arrival yet,” but expected Malloy’s abandonment of the present bill to hurt in the legislature.

“I’m very worried that the momentum for the bill will stop,” Andrews said. “I just don’t see us being able to start from scratch all over again. I personally never thought that the politicians would agree to turn over that much control to a SustiNet board, but we always expected that could be negotiated in the end, not a reason to kill the bill.”

Andrews said a large coalition of health care groups worked for more than two years on the bill.

“There were hundreds of people involved in building the consensus that brought SustiNet to Hartford,” Andrews said. “We had consumer groups, churches, insurance companies, doctors, nutritionists — it was a Noah’s Ark with two of each. … A lot of these people are going to be disappointed now.”

Malloy’s new position on the bill has moved him closer to Republicans in the legislature, who have argued since the SustiNet bill was introduced in January that Connecticut could maximize federal dollars without its own state reform, and that creating a new state bureaucracy for health care was an unnecessary expense.

“I am actually very complimentary toward Gov. Malloy for how he has been straightforward on this,” said State Sen. Jason Welch, R-Bristol, a member of the public health committee. “We absolutely do not need SustiNet to save money under the new federal law, and Malloy knows he has a bigger fight right now. He needs to balance the state budget first, and SustiNet doesn’t do anything to get him there.”