by Katherine Restrepo
Director of Health Care Policy, John Locke Foundation
It has long been established that the incoming Trump Administration and a Republican-controlled Congress have plans for a partial repeal and replace of Obamacare. What does this entail? There are quite a few conservative plans that have been floating around for quite some time, each with their own policy nuances on how best to reform our nation’s health care system.
From a free-market standpoint, health reform means fewer people having to rely on government assistance when accessing an insurance plan, whether that be Medicaid or subsidized private coverage offered on Obamacare’s Exchanges. Getting to this point means fewer regulations over health care suppliers, insurers, providers, and patients. Reform also means improving access to health care for people with or without health insurance. Getting to this point also means fewer regulations over health care suppliers, insurers, providers, and patients. It also means pushing for more consumer control over health care decision-making, which inevitably drives more price transparency and downward pressure on health care costs. For starters, increasing Health Savings Accounts (HSAs) contribution limits would be welcomed.
As Washington preps to downsize the federal government’s role in health care, deregulation can also be accomplished at the state level. Now that North Carolina’s long session has commenced, legislators have many opportunities to provide more health care freedom to their constituents.
A 2016 study released by the Mercatus Center, the Healthcare Openness and Access Project, now provides a narrative for each state’s overall health care freedom when measuring regulatory controls across ten different health care categories. North Carolina cumulatively ranks 43rd. A few notable categories that are worth discussion include health insurance laws, occupational and provider regulations, and direct primary care.
State Health Insurance Law
North Carolina is tied for 27th with nine other states and ranks on par with the national average on selected health insurance laws. While the Affordable Care Act has narrowed states’ regulatory flexibility when it comes to pricing insurance premiums based on age, tobacco use, and policyholder residence, North Carolina does not enforce these rules to a stronger level beyond minimal federal compliance standards. However, room for improvement remains in other areas of health insurance law. The state ought to reconsider its rate filing review process. Insurance companies must gain approval by the Department of Insurance when filing both individual and group insurance premiums prior to annual enrollment periods. Ideally, health insurers should be able to design and price plans as they see fit.
North Carolina also has legislative authority over health benefit mandates. These laws require certain businesses and individual policyholders to pay more for their health insurance coverage because insurers are forced to cover or offer expanded services that benefit particular populations and providers. Pastoral counseling, podiatry, and psychology services are just a few of the 56 mandates North Carolina imposes – ranking in the top 15 nationwide. Policyholders should exercise their freedom to tailor their health insurance plans based on personal medical needs.
Occupational and Provider Regulations
Relaxing occupational and provider regulations will further boost North Carolina’s cumulative health care freedom ranking. Occupational licensing reform would grant mid-level medical providers like nurse practitioners the authority to practice within the full scope of their training. Under current law, nurse practitioners must practice under direct physician oversight when prescribing medications and ordering diagnostic tests. Granting mid-level providers full practice authority will help reduce primary care shortages in 145 areas across the state and mitigate access issues in rural and underserved areas.
Repealing the state’s certificate of need (CON) laws would also enhance North Carolina’s health care freedom. CON is a process in which medical entrepreneurs and doctors must receive permission from the state to offer certain types of health care services like organ transplants or diagnostic imaging. They must also receive permission to build or expand new facilities such as long-term care centers, hospitals, and ambulatory surgery centers. The law ultimately prohibits medical innovation and competition in the health care marketplace, upholding high health care costs and limiting patient choice.
Direct Primary Care
It should be noted that despite some of North Carolina’s stifling health care regulations, many primary care doctors in the state are able to practice family medicine in innovative ways. More than 30 physicians statewide have embraced direct primary care (DPC), an alternative health care delivery model in which patients receive around-the-clock health care in exchange for a periodic cash fee. This model is similar to concierge medicine, but direct care physicians do not accept insurance. North Carolina currently is tied for 24th with six other states in this category.
Although direct primary care in North Carolina is subject to minimal regulations, a higher ranking could be achieved if the state passed legislation clarifying that direct care physicians are not an insurance entity. To date, 17 states have passed similar legislation. Protecting direct care physicians from being regulated under the department of insurance would secure this free-market health care model, as insurance commissioners may view direct care physicians as stepping into the unlawful business of insurance because they are taking on an enormous amount of risk to provide unlimited primary care needs for all of their patients.
For a more in-depth explanation on the indices chosen to measure North Carolina’s overall health care freedom ranking, you can access the Mercatus Center’s full report here.