Sebelius: Same Rules for Public and Private Health Plans

Janice Simmons, for HealthLeaders Media , May 7, 2009

Department of Health and Human Service Secretary Kathleen Sebelius, during her first full week on the job, paid a visit to Capitol Hill Wednesday morning for her first formal opportunity—aside from the confirmation process—to discuss healthcare reform. Chief question on the minds of House Ways and Means Committee members during her conversation in front of the panel: what is President Obama's vision for a public health plan?

She said she shared the president's belief "that reform must guarantee choice of doctors and health plans," along with the public and private plan options, she told the panel. "No one should be forced to give up a doctor they trust or a health plan they like. Comprehensive reform shouldn't force any Americans [to give up] their coverage to make changes."

She sees the public plan option operating much like state employee health plans currently operating in 30 states, including Kansas. The public option plans generally are offered side by side with private plans to state employees—giving them competitive choices from which to select their coverage, she added.

She also noted that a number of states have established health insurance plans for children with side-by-side private and public providers. "It's about the rules that are established in the beginning, and the president and I are committed to working with members [on Ways and Means] and other members of Congress to make sure that the playing field is level."

By level playing field, she explained that for years, many private insurers operated on a "tilted field" where cherry- picking—or selectively choosing healthier patients—"is a strategy to make a profit," she said. This could make insurance unaffordable or unattainable for some individuals. "That doesn't work in a health exchange," she said.

If the rules are the same with public and private plans, the individuals with lower incomes or previously uninsurable conditions that come into the health exchange can choose between public and private plan options with the same rules. The goal, she told the panel, is for public and private plans to "compete on practice and protocol, on lowering overhead costs, on lowering administrative costs, and driving benefits to their incoming enrollees."

As to what the president is expecting to see in terms of healthcare reform in Congress, she assured the panel that he does not have a specific plan sitting in his desk drawer on reforming the health system. "I can assure you that it does not exist," she said.

Instead, she said his goal was to get the ball on healthcare reform moving forward. "His charge to me as the new secretary is to work closely with [congressional] committees as proposals are being developed," she said. "But the specific legislative language, the framework of exactly what the benefit package ultimately looks like, what the exchange may or may not look like will be a collaborative effort . . . primarily engaged in by Congress."

Janice Simmons is a senior editor and Washington, DC, correspondent for HealthLeaders Media Online. She can be reached at

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