How would ‘competition’ approach change your health care coverage?

With its emphasis on free enterprise, the Reagan Administration hopes to hold down health care costs by encouraging more com- petition in health insurance. Six “pro-com- petition” bills were in the hopper as of mid- April.

The competition approach has three general principles:

0 Your employer would offer several health plans for you to choose from. Then you could choose minimum benefits for the lowest pre- mium or more benefits at a higher cost.

0 Your employer would have to make an equal contribution to health insurance pre- miums for all employees, regardless of which plan they choose. You would make up the difference if you chose a more expensive plan, or you might get cash or other benefits if you chose a cheaper plan.

0 Income tax laws would be changed. You and your employer might not be able to deduct as much of your health insurance premiums as you can now, depending on the plan you choose. Supposedly, this would encourage you to select more economical insurance.

All of these features are designed to moti- vate you and your employer to scrutinize your health insurance plans more carefully. In turn, insurance carriers would be encouraged to keep their costs down so they can keep their premiums as low as possible. Theoretically, they will not be able to keep premiums low if they are not keeping an eye on the health services they pay for.

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Experts believe that “third-party” payment is partly responsible for skyrocketing health care costs. They reason that when an insurance company pays your hospital bills, you do not examine your bill as carefully as you would if you were paying the hospital directly. They also believe that you are not as aware of the costs of your insurance if your employer is paying most of the premium. These bills are designed to alter that situation.

Since the approach is aimed at employees, critics are concerned about health care ser- vices for the poor and unemployed. The Ad- ministration has not yet specified how it plans to incorporate them into the competition plan. Proponents of the free market appoach have not indicated what would happen to the “medi- cally indigent’’-those who use hospital ser- vices but cannot afford to pay.

Three of the bills are S 433 sponsored by Sen David Durenberger (R-Minn), HR 850 sponsored by Rep Richard A Gephardt (D- Mo), and S 139 sponsored by Sen Orrin Hatch (R-Utah). Before being appointed to their Cab- inet posts, Richard Schweiker, now secretary of the US Department of Health and Human Services, and David Stockman, director of the Office of Management and Budget, also spon- sored bills.

The Nurse Training Act is on its way again, with new bills in the House and Senate. Sen Orrin Hatch (R-Utah) is sponsoring the Senate version, which would provide only $1 30 million for the health professions in fiscal 1982. Rep Henry Waxman’s (D-Calif) House bill is con- siderably more generous, with a proposed $600 million authorization.

As last year, the Nurse Training Act is com- bined with the other health professions in one

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bill. Representative Waxman’s bill is essen- tially the same as the one that passed the House last year.

President Reagan has also proposed se- vere cuts for nursing education money already appropriated for 1981 and for his 1982 pro- posed budget. The present funding level of $1 03 million would be reduced to $1 5.2 million. The $6 million now available for nursing re- search grants and fellowships would be cut. The Administration wants to take back $63 million already appropriated for this fiscal year. The American Nurses’ Association said the effects would be “disastrous” and is asking for grass roots opposition to the cuts.

The head of the California nursing board said in early April that she is “cautiously op- timistic’’ that the board can work out its differ- ences with the National Council of State Boards of Nursing over the national RN licens- ing exam. As a fallback position, however, the board has taken the first steps to developing an independent state exam.

California has found that the current State Board Test Pool Exam, used for licensing nurses in all 50 states, has an “adverse im- pact” on minority groups. If the exam cannot be proven “job related,” it will be in violation of state law. (See AORN Journal, April 1981, 834-835.) Then the state would have to ad- minister its own exam, explained Barbara Brusstar, executive secretary to the Board of Registered Nursing.

The Department of Consumer Affairs, a state agency, is studying the state boards to see if they are job related. They are evaluating such issues as how the exam is constructed, whether it tests knowledge and skill needed on the job, and the appropriateness of reading levels and time limits.

Meanwhile, the state boards are being re- vised. A new integrated national exam will be given in July 1982, replacing the current five- part exam. A new testing service is also being selected to prepare exams to be given after the 1982 exam.

The National League for Nursing has created and graded the state boards since the beginning, but the League was not chosen by the National Council as one of the three finalists for the new contract. Delegates to the National Council annual meeting will make the

final selection for a testing service this month. Brusstar said the California board has been

actively involved in selecting the new testing service and in negotiating with the National Council about their concerns. In exploring the possibility of an independent exam, the board “is trying to keep options open,” she said.

How would a separate California exam affect reciprocal licensing between states? That is “conjecture,” Brusstar said, since no final de- cision has been made to do so. She added that California has “reduced barriers for nurses coming in.” As for other states, she said, “I can’t imagine states wanting to keep other nurses out, especially with a nursing shortage.”

Sen Daniel K lnouye (D-Hawaii) has intro- duced two bills to extend further the direct reimbursement of certified nurse-midwives. S 161 and S 162 would cover nurse-midwife ser- vices under Medicare and the health plan for government employees.

Nurse-midwives now are entitled to receive direct payment under the military’s health plan, under Medicaid, and under a pilot project for federal employees living in medical shortage areas.

Patricia Patterson Associate editor

Learn how government affects your practice Do you think legislation has little to do with how you practice nursing? You may be in for a surprise. If you would like to learn more about how you are affected and what influence you can have, plan to attend AORN’s first national seminar on legislation Oct 24 and 25 at the Oak Brook (111) Hyatt near Chicago’s O’Hare Airport.

Speakers will be Lillian K Gibbons, DPH, staff member of the Senate Finance Committee in Washington, DC; Deborah Smith, RN, lobbyist for the Illinois Nurses’ Association; and Joseph Radzius, Chicago attorney and advisor to the AORN Board of Directors. For more information, see the seminar schedule in this issue.

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