With outlook bleak for public option, lawmakers shift to new 2020 health care agenda

A day after the legislative session ended and still reeling from the defeat of a sweeping public option bill, lawmakers and Gov. Ned Lamont vowed in June to revive the health care overhaul next year.

But as the General Assembly gets closer to reconvening, prospects for a resurrected public option measure are looking dim, and the debate around health care reform has shifted to cost containment, prescription drugs and reinsurance proposals that have bipartisan support.

“Any bill runs the risk of a short session. We get in during early February and adjourn the first Wednesday in May. There are so few session days that to get a complicated bill through a public hearing, through a committee, maybe more than one committee – and the public option has a fiscal note – it’s difficult,” House Majority Leader Matthew Ritter said. “You’d have to move pretty quickly.”

Along with a limited timeframe in 2020, Ritter said the tension surrounding this year’s effort is still lingering, dampening plans for a comeback.

The Democratic co-chairs of the legislature’s Insurance and Real Estate Committee last March introduced a proposal that would have opened the state’s health plan to nonprofits and small companies and established an advisory council to guide the development of a public option. The bill would have allowed the state to create a program, dubbed “ConnectHealth,” that offered low-cost coverage to people who don’t have employer-sponsored insurance.

In May, with less than two weeks left in the legislative session, the lawmakers, joined by Lamont and Comptroller Kevin Lembo, rolled out a new and expanded version of the bill. The updated proposal – called the “Connecticut Option” – would have created a state-sponsored health plan for individuals and small businesses that don’t have employer subsidized coverage, and re-established an individual mandate to help pay for it.

The measure was dramatically enhanced to also include a tax on opioid manufacturers; a cap on rising costs imposed by providers, insurers and others; drug importation; and the reversal of a major cutback in the state’s Medicaid program for working poor adults.

Proponents said the aim of the Connecticut Option was to guarantee a 20 percent premium savings compared to plan rates in 2020. Lembo’s office would have sought bids and partnered with an insurer to bring the Connecticut Option as a publicly sponsored competitor to individual and small group markets.

But hopeful plans were dashed only six days later, when Lembo told The Hartford Courant’s editorial board that a threat by the head of Bloomfield-based Cigna Corp. had effectively killed the proposal.

Lembo said Cigna CEO David Cordani warned he would uproot the company and leave Connecticut if a public option passed. And within days, legislators gutted the bill, leaving only the pieces that pertained to drug importation, cost containment and reinsurance.

The watered down version cleared the House but died in the Senate.

Now, lawmakers appear to be using that diluted version of the bill to shape their health care agenda for 2020.

“You’re going to see a lot of work on drugs in 2020. Importation was something that 75 percent of the legislature in the House voted for back in June, and it will remain something that we push for in 2020,” said Sean Scanlon, D-Guilford, a co-chairman of the Insurance and Real Estate Committee.

The proposal would allow state officials to seek permission from the federal government to import prescription drugs from Canada at deeply discounted prices. Similar laws have passed in Vermont, Florida and Colorado.

The drug effort will also involve addressing the skyrocketing cost of insulin, which has become a crisis in the U.S. as people forgo the medicine or switch to alternatives, sometimes with grave consequences.

The Health Care Cost Institute has reported that Type 1 diabetes patients – who generally must inject themselves every day — paid an average of $5,705 for insulin in 2016, nearly double what they paid four years earlier.

Over the last decade, the list prices of some types of insulin have tripled, even though they’re the exact same products offered 10 years ago.

Other initiatives at the forefront of legislative discussions include the pursuit of a reinsurance waiver to mitigate risk from sizable claims. Under last spring’s unsuccessful proposal, insurers and health care centers would have been required to pay an annual fee, and that money would have covered large medical bills to keep premiums down.

The tax on insurance companies will be up for debate again next year. Republicans in the Senate have opposed it, opting instead to use money from Connecticut’s general fund for reinsurance.

Lawmakers also want to set yearly benchmarks to contain the swelling cost of care, and work with providers who exceed that threshold.

Sen. Kevin Kelly, R-Stratford, had scheduled a forum in September to kick off discussion on those ideas. But his event was postponed after Democrats in both chambers said they wanted more consensus and private debate around the issues.

“The challenge is always trying to get it right. You want to get the policy that works the best for the most people,” he said. “The challenge is getting the political will and then getting the stakeholders around the table to try to move something forward.”

Kelly said many Republicans are supportive of an agenda that includes drug importation, reinsurance and cost containment. But the details of those plans are still being ironed out. He remains opposed to placing a tax on insurers. States that rely on premium assessments in connection with a reinsurance program receive fewer federal dollars than those who use money from the general fund, he said.

Democrats have not yet offered specifics on what the health bills might look like. Sen. Matthew Lesser, a co-chairman of the insurance committee, said the goal is still to lower the cost of care by 20 percent or more.

“There’s no lack of appetite on that,” he said. “We have not solved the issue of health care, and there’s going to be mounting pressure on the General Assembly and on the governor to show that Connecticut could lead the country in figuring out what smart reform looks like. … How we get there is TBD.”

Scanlon and Lesser haven’t abandoned hopes for a revival of the public option, but both acknowledged the difficult road ahead. State lawmakers are up for re-election next year, making controversial legislation even more arduous. On top of that, the regular session will run for only three months in 2020, instead of five.

“I don’t think public option is going to happen in this state,” Senate Minority Leader Len Fasano said. “I’m not speaking for the governor’s office, but certainly my understanding is that they’re not enamored with the idea either. I really don’t think it has legs.”

Through a spokesman, Lamont dodged questions about his support for a new push on the public option. A day after the General Assembly adjourned in June, Lamont called the bill “a big, important reform,” and said it would be revisited, perhaps “in pieces.”

“The governor is working with both parties in the legislature to explore options to address the significant challenges that the high and rising cost of health care poses to Connecticut families and businesses,” the spokesman, Max Reiss, said. He did not elaborate.

Representatives for the insurance industry say the companies remain firmly opposed to a public option. Meetings between legislators and insurance executives in the off-session have produced no agreements, and company leaders are watching the General Assembly’s next moves closely, said Susan Halpin, executive director for the Connecticut Association of Health Plans, which lobbies on behalf of insurers.

“We’re resolute in our opposition to any expansion of government-run health care,” she said. “We’re happy to look at the exchange, identify specific issues and work to address those. But in terms of expanding any government-run type health care programs, we remain opposed.”

“As one of the largest employers in the state, we’re always going to continue to have a dialogue with policymakers,” Halpin said. “But at present, that does not include any contemplation of our support for an expanded role of government-run health care.”

Halpin declined to comment on the push for reinsurance, drug importation or other initiatives, saying it was too early.

“People are paying very close attention to what happens in Connecticut,” she said. “It’s a bellwether state for the rest of the country. As the insurance capital of the world, it’s incredibly important what happens here.”

The fight isn’t limited to Connecticut. A powerful coalition of insurance companies, hospitals and the pharmaceutical industry, among others, are engaged in a national lobbying effort against Medicare-for-all proposals and public option bills. That coalition, called the Partnership for America’s Health Care Future, is funded by the insurance industry and its allies. It spent a combined $143 million lobbying in 2018 alone, according to data from the Center for Responsive Politics.

If the forces working against the public option are too strong for the bill to return next year, Scanlon wants proponents to keep it on the backburner. Despite fierce opposition, several Democrats still support the measure.

“It’s not always about a single-year strategy,” Scanlon said. “Whether the public option comes back next year or the year after or the year after that, I’m not sure. But it will always be an issue that we’re going to have to address because people are looking for relief.”