The Autism Bill: Negative Outcomes From Good Intentions
There is an ironic tension between two health care bills currently pending in the Missouri Senate. One seeks to create an amendment that would increase health care freedom, while another would add to an already lengthy set of health insurance mandates. The latter bill, S.B. 618, would require state-regulated private health insurance companies — approximately 40 percent of the Missouri market — to cover expensive screenings and therapy for children with autism spectrum disorders. (The House version, H.B. 1311, recently passed.) Although well-intentioned, this mandate would necessarily raise the cost of premiums for Missourians, making it more difficult for individuals and small businesses to keep health insurance plans.
S.B. 618 would require insurance plans to cover up to $55,000 annually for autism diagnosis and treatment for children up to the age of 21. A mandate of any amount increases health insurance costs, and the bill’s substantial commitment would assuredly have a noticeable effect. Its proponents argue that it would increase the price of health care premiums by less than 1 percent, while insurers believe it could raise premiums up to 3 or 4 percent. Although the bill would exclude small businesses if it raised their premiums by more than 5 percent, any increase would necessarily price some marginal number of people and companies out of the insurance market, forcing them to cut coverage or reduce hiring.
Autism is a problem in Missouri, and it is not difficult to be swept up by the heart-wrenching stories of families with autistic children. But there are many disorders and diseases that afflict people — children and adults alike — and mandated coverage of all or even most of these problems would make insurance prohibitively expensive. These kinds of mandated coverage makes insurance more expensive especially for those with diseases that are not given state protection.
It’s important to note that some forms of autism aid already exist. Although not as comprehensive as an insurance mandate, there are publicly and privately funded resources for Missouri children with autism spectrum disorders, including Medicaid waivers for families who would not otherwise qualify for assistance, and a nonprofit private school for children with severe autism.
A large part of the argument in favor of the mandate lies in the unpredictability of health insurance when it is attached to employment — a problem only exacerbated by the current economic climate — and the difficulties involved in obtaining a plan that covers autism. Instead of government-imposed mandates about coverage, families should be free to choose an insurance plan that best fits their needs. Politicians cannot know the optimal equilibrium point between price, risk, and security for any type of insurance coverage, let alone for autism, because that equilibrium will differ for everyone.
The bill in question adds a much-needed amendment allowing Missourians to purchase out-of-state insurance that does not mandate autism coverage, although Missouri already has a mechanism that would help all families find affordable health insurance. Health savings accounts (HSAs) allow policyholders to become consumers, giving them the power to choose an appropriate coverage level. HSAs are portable, and therefore less dependent on job stability that may not always be available in an uncertain economic climate. Both employers and employees can contribute pretax funds to HSAs, which can then be used toward paying most basic health expenses. With an HSA and an accompanying high-deductible plan, consumers can budget their health care expenditures more effectively than bureaucratic cost-cutting is able to do.
State mandates raise health insurance costs across the board, and decrease people’s access to affordable coverage. In the long run, the most effective solution for families with autistic children — or any other disorder — is to open the insurance market to further competition, giving them a practical economic incentive to cater to such niche markets. Small businesses — at any point, but especially during a recession — are extremely cost-sensitive to changes in premiums like the one that would assuredly occur following a large mandate on autism treatment and diagnosis. Although this insurance mandate aims to help families with autistic children, it would simultaneously hurt another group of Missourians who would face significant cost increases, or even the potential loss of their own health insurance coverage.
Ms hartsell – you make some valid points in your case however i think the main issue is of discrimination- why do we choose to cover children with diabetes or heart defect or obeisty but say to a children with asd – sorry you need not apply ?
Just cover it like every other medical condition ?
Comment by ron — March 10, 2010 @ 7:18 p.m.
I agree, Ron, but mandates are not the solution. As I said in the blog post, there are a plethora of potential diseases, many of which can be financially devastating. It would be near impossible to cover all without significantly increasing the cost of health insurance (and forcing many people off of their plans, essentially.) By mandating coverage of some, like autism, it makes insurance more expensive for everyone, including those people whose diseases or conditions are not covered. The real solution is to increase competition by putting the spending decisions in the hands of the patient and their family– insurance companies are then forced to respond and provide necessary coverage in a way that they do not under the current employer-health insurance model.
Comment by Caitlin Hartsell — March 11, 2010 @ 6:31 a.m.
Children have been diagnosed on the autistic spectrum for decades. This is not an issue that has only been around for a couple years. This Bill is not a knee-jerk reaction. I am all for the open market to take care of this situation, but until then I am glad the state of Missouri forced the hands of the insurance companies.
Also, all the statistics and dollars provided appear to be worst case scenarios. I wonder how it will all truly shake out…
Comment by DaveG — March 12, 2010 @ 1:00 p.m.
Ms Hartsell,
I must ask, are you in contact with a child that has autism daily? I must say by your comments you are not so there for I will gladly let you know that this year alone more children will be diagnosed with autism than cancer, diabetes, Downs Syndrome and AIDS combined. I am a proud mother of an autistic 3yr old daughter and tend to get very loud when I hear people stating their opinion when they do not have any personal connection to what they are talking about. I would suggest to you to maybe sponsor an autistic child for a year and take them through all their treatments and therapies. We will see where you stand then when it comes to your personal money being forked out. My husband and I have worked very hard for what we have earned throughout our 11 years of marriage, nice house on the lake, 2 nice SUVs paid for, carefree getaways every 6months, but at this moment we are looking at renting out OUR house we worked so hard for and moving in with the mother-in-law, only because we are working hard on recovering OUR daughter from autism. Althought I wouldn’t change any of it for the world, it was not her choice to have autism, she did not come into this world with autism, but you know what she is slowly back to us. We have poured all of our savings and earnings into getting her back and its working. But yet me being a smoker, if I get lung cancer, my insurance is going to cover it if I need a new lung…tell me where that makes sense…It was MY choice to smoke. So for you to say that we should “open the insurance market to further competition” you are wrong…and just to let you also know that WE do not qualify for Medicaid because WE make TOO much and as for the nonprofit private school…please show me where one is in my area. Like I said maybe you should go get in contact with one of the families that is part of the statistics of 1 in 91 children..
Comment by Michelle O'Day — March 13, 2010 @ 12:52 a.m.
I’m sorry about the financial situation that your daughter’s autism put you in, and I really do sympathize. I do not have daily contact with autistic children, but I do have close family members with other conditions and diseases, like cerebal palsy, juvenile arthritis and lupus. I do know that these sorts of diseases can be financially disastrous, and I don’t think that’s a good thing.
The problem is that mandates do more harm then good. If we mandate coverage for cerebal palsy, but do not mandate coverage for autism, juvenile arthritis and lupus, then it becomes more expensive for everyone else, especially those who do not receive a mandate privilege. Some people will lose their health insurance entirely over the difference. The better solution–even though it may not be entirely evident– is to increase transparency and competition so that some health insurance companies have to cater to the niche autism-spectrum disorders market.
Health Savings Accounts are great for expensive diseases– my twin was diagnosed with lupus 5 years ago, but we were lucky enough to have an HSA and that was manageable. Once you’ve paid the high deductible, the insurance part kicks in. HSAs, in large scale, would be a great way to cover autism treatment.
If that is still not sufficient, I would next consider expanding the Medicaid voucher program, as it could be a more cost-effective way to cover the treatment. It already covers families far above the poverty level, but increasing that income level might be a more effective solution than mandating health insurance coverage.
I am not advocating that a person go into financial ruin over health care; I just believe mandates are not the solution.
Comment by Caitlin.Hartsell — March 13, 2010 @ 9:03 a.m.
[...] am all in favor of eliminating government mandates, whether it be in health care, energy, or any other area in which the government attempts to control the market, but the removal [...]
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