Governors Form Health Reform Task Force: Will States Have To Trade Off Oversight For Coverage?

Michigan Gov. Granholm and Vermont Gov. Douglas will head the new task force.

The National Governors Association is forming a health care reform task force to jump "with both feet" into the reform debate, Michigan Gov. Jennifer Granholm said Feb. 22 during the group's annual winter meeting in Washington, D.C.

Granholm, a Democrat who was first elected to the governor's post in 2002, chairs NGA's Health and Human Services Committee and will also co-chair the health reform task force. Within her own state, Granholm has spearheaded a number of health-related initiatives, including a prescription drug bulk-purchasing pool and a drug discount card.

"The House, the Senate, the White House have all made this a top priority and governors are going to do that as well," she said during a meeting of the NGA health committee. "We have formed a health care reform task force as governors. We have been invited to provide input to the Obama administration and Congress ... so we are going to jump on that with both feet and present them with a plan."

Just before the health panel convened, Granholm and her colleagues held a closed-door lunch with White House Office of Management and Budget Director Peter Orszag, who assured them that health reform is the administration's leading priority after economic stabilization (see related ¹ (Also see "How Much Reform And How Fast? Key Questions For Presidential Address" - Pink Sheet, 23 Feb, 2009.)).

Govs. Sebelius, Bredesen on task force

The new task force's other co-chair is Vermont Gov. Jim Douglas. It also includes two governors whose names have been floated as possible HHS secretary candidates: Kathleen Sebelius of Kansas and Phil Bredesen of Tennessee. The other members are Edward Rendell, Pennsylvania; Sonny Perdue, Georgia; Tim Pawlenty, Minnesota; John Hoeven, North Dakota; Jon Huntsman, Utah; Christine Gregoire, Washington; Deval Patrick, Massachusetts and Connecticut Jodi Rell, Connecticut.

The panel does not yet have a timeline for developing and presenting a plan, according to NGA staff.

Governors have a serious financial stake in health reform, given rising costs for Medicaid and state employee health programs, as well as being on the front lines of confronting health needs of the uninsured and newly unemployed.

But Granholm also pinpointed a key issue for state officials - how much control they relinquish, or gain, over health issues as part of a federal reform package.

Governors will "grapple" with issues of state control

"Are we willing as governors to give up a bit of that responsibility if we assume there will be a package that covers more of our citizens?" she asked. That is an issue the governors will have to "grapple" with.

That issue surfaced several times in the committee's discussion. For example, South Dakota Gov. Mike Rounds said he did not want to lose even more ability to regulate health plans or fix problems that might surface. He noted that the federal ERISA statute, the Employee Retirement Income Security Act, has often been a "hurdle" for state regulators as it largely preempts state insurance laws in the area of employer-provided benefits.

Massachusetts Gov. Patrick suggested that one entity could become a true "market player" if given the flexibility to bargain for both Medicare and Medicaid coverage in a state. Massachusetts has raised that idea to HHS, he said.

In response to questions from Granholm, Patrick said he is not sure of his position on a health reform program that gives governors less flexibility rather than more. Massachusetts' state health reform program has resulted in coverage of 97 percent of the population, he said.

Granholm said there are a "cluster of principles" likely to shape any health care reform package, based on discussions by a variety of stakeholders. These include "some element of choice" of health care plans and physicians. Also, "there must be a core benefit in this structure somehow. What that core benefit includes, obviously, is something we can discuss but part of that core benefit, many have said, should include some preventive care as well as long-term care." The program "must be cost efficient in some way that has to have some logical assessment of effectiveness and cost."

And "many have said - and this is where the shift or paradigm movement has occurred in many - is that it's got to be a shared responsibility, one part business, one part individual, one part government," Granhold said.

- Denise Peterson ([email protected])