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1) Sen. Cherry's "journal statement"  by Admin003 on December 3, 2005 
Senator Cherry's statement is as follows:

I rise to oppose Senate Bill No.896. The good Senator from Macomb County talked quite a bit about some of the concerns that I have. I am specifically concerned about the fact that this bill does not require this insurance program to be in compliance with the insurance code.

I heard lots of testimony about the great pool in Grand Rapids. I do think it's a very good program, and we know that schools can do those already. But the thing that I think is important about that pool is that it operates under the insurance code now and the rules and regulations that we have in place currently, and this package does not.

There are so many concerns that need to be addressed, those being the issues of making sure that there's enough funds in the catastrophic claims account, the issue of voluntary versus nonvoluntary, and how that impacts upon the rate. Unlike the previous Senator, the issue of a group going in and out does have some cherry-picking concerns. Although I hate that term--I always have hated that term--it just is not the right one to use. But, in any rate, it is often used and that's a very legitimate concern because it affects the rates that people are going to pay.

In addition, it is important that any kind of insurance program that we have be concerned about protection for the people who are part of that insurance program or pool, or whatever we choose to call it. And that's what the insurance code is there for. This is outside of that realm, and I again hope that members oppose this bill.

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2) Sen. George's "journal statement"  by Admin003 on December 3, 2005 
Senator George's statement is as follows:

The problem, as I see it, with our current health benefit system for school employees is that it really perpetuates the public health problems that school employees face, which are the same ones that we face and that our constituents face, and that is our high rates of cardiovascular disease, high blood pressure, strokes, heart attacks, etc. The current system of health benefits for school employees does little to address those underlying public health problems, and why is that? Well, in part, it is because they are based on a pooled rating or community rating system. What is the incentive for you if you're an individual school employee or for your school or for your school district, for that matter? What is the incentive for you to attend to your own health if you see no benefit in the package that you're offered or if your school district gets no better deal when they go to purchase health insurance?

There really is very little in the current system that rewards healthy behavior or that gives incentives for individuals or districts to attend to their own health behaviors. You can look on the MESSA website and you can look for information about wellness for employees and you can find a page. They do have a wellness page that provides some educational information. You can read about the benefits of health education. The website provides access to some educational materials. It might guide you to flyers or pamphlets or newsletters or even videos. The website says that MESSA gives valuable information to physicians about clinical practice guidelines--at least it says that. The website says that members can find tips on how to improve their relationship with physicians. But, members, I don't see how any of these things do anything to improve the health of the employees who are depending on MESSA for their benefits.

If you look at the website, you'll see that, well, there's a 1-800 number you can call and if you press prompt 3, you can order a men's or women's health initiative packet--again, more educational material. That's all fine and good, but we've been spending millions of dollars. The state's been spending tens of millions of dollars on health education and it hasn't worked. Despite that, we're the least healthy state in the country, and MESSA is using the same failed strategy.

If you look at their website, well, here they had a health conference recently and they invited school employees to attend. You could get a grant to attend and at the conference, there were sessions you could attend. There was one on "The Brain Gym." I don't know what that is. I don't think going to a session on the brain gym is going to make you healthier. There's one on "Stuck in the Sandwich Generation." There was a session on restorative yoga. At the conference, the attendees were given a list of stress busters to make them healthy. These are on their website. Here's some of the stress busters you can use at work: "Close your door; have a softball team; tell jokes; have fun times with co-workers; shut yourself in the freezer and scream; use a stress ball; simplify your workspace." Again, these are from the MESSA website on how to be healthy: "Stay out of the teacher's lounge." Here's a good one, "Have a waterfall at your workstation." I'm not sure how you do that, but it sounds nice. "Low lighting; use positive self-talk." And here's some health tips for at home. My wife would like this one: "you can knit"--that's good. "Take a bubble bath; think about words." That's what it says: "Think about words. Scream in a pillow. Have surprises. Do projects in small steps. Be outside. Stay off the phone." And the final tip from MESSA on how to be healthy, "Have a moon-watch." OK?

So my point here is, look, the current benefits package isn't making school employees healthier. There is an educational component to it, but that's not enough, and if you're going to design a package that's really going to work to make employees healthier, you need claims data. You need to be able to shop around and compare insurance products, and if you're self-insuring which most of these districts, I assume, would do, if you're going to self-insure, and you've got blinded claims data, then you can tailor your program to the needs of your employees. You can design programs to address a finding that you have higher claims for asthma or for heart disease or for high blood pressure. You can tailor programs to your employees and you can reward them. You can gear it toward their health habits. That's the beauty of having the blinded claims data.

Finally, I wanted to address one of the other points that was made. There was some allusion to medical society literature, comparing the catastrophic claims pool to Medicaid HMOs, and I think that's just ludicrous. The catastrophic claims pool, as you know, would be voluntary. The rates would be recalculated every year. Many, many private companies use those already. If they self-insure, they go and they buy catastrophic coverage from some private carrier, and that system works just fine. They're the ones who are on the cutting edge of keeping their employees healthy, and comparing that to Medicaid HMOs is just ridiculous. So I don't buy that argument, just like I don't buy the cherry-picking argument.

I would hope that my colleagues would support this bill and this whole package because this is really the way that schools can design programs to help keep their employees healthy.

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3) Sen. Switalski's "journal statement"  by Admin003 on December 3, 2005 
Senator Switalski's statement is as follows:

You know, the weather outside is frightful, but I would ask the body's forgiveness for the impetuousness of my youth, speaking at some length on General Orders, where my remarks are not recorded, and therefore, cannot be used for my "no" vote explanation. So now I'm in the position of having to repeat some of those remarks and I ask your forgiveness and indulgence for that.

I wanted to make the point that there has been a lot of debate on this subject, but little on this specific package. This has been something that we've debated at least since this summer under a different package of bills and had a study commissioned by the Hay Group and went over that at some length. There has been some reference to the billion dollars in savings, but our discussion of those savings, the chief area of savings in the Hay Group study, was through the elimination of traditional fee-for-service insurance, which is not being proposed in this package and would be a significant change in benefits.

So the original bills that we discussed this summer were identified during the committee meetings as dead on arrival, and there would be different bills. Here we have the different bills, and I just want to make the point that I don't believe we've had enough discussion on the particular aspects of these bills.

Secondly, the chief bill under consideration here, Senate Bill No.896, deals with the creation of the catastrophic pool and, as has been said earlier today--and I agree with--we have a very good example of a catastrophic pool being created in this state in Grand Rapids. There are some 13 districts, I believe, that have joined that pool and more are joining every day. In fact, I hear that the phones are actually ringing off the hook of people who want to join and that's a great thing.

The point is that that is possible under current law and that was created and is a success under current law. There has been some discussion this summer. One of the complaints about that process is that it took two years to create that fund and that has been discussed today as to some three years, and I would just say that the first time you do something of this significance, I would think that you'd want to take some time with it. I don't think it's something that people should rush into without a lot of preparation.

I was involved in a self-insurance change in the county of Macomb, and we took a couple of years to put that into practice because it's a very significant change. There is a lot of politics surrounding this issue, but I think most important are the significant policies, and we ought to concentrate on the policies. Those are very important. And the essence of this bill, I think, is the requirement that comprehensive claims data be provided for specific district populations on the health experience of those groups, and we ought to think about that because just in the past year, we went and made some significant changes to the small-group market for insurance and that was because we saw cherry-picking and adverse selection going on. We had groups, maybe you'd have a group of, say, ten employees and eight were healthy and two were not so healthy, and people would break that group up and market the eight people and then stick the unhealthy ones with the provider of last resort. Blue Cross--they would have to pick them up. So you'd get cherry-picking. You'd get a lower rate on the healthy people, but that pool of higher-risk employees would end up in a higher-risk group, and we could have that effect through this legislation. We ought to be very careful about that because that goes against the fundamental premise of insurance, that we get everybody in, share the risk across everybody and ensure stable, affordable rates.

I'd also like to amplify my remarks from earlier today about the question of reserves, and there's a section in Senate Bill No.896, which I've just had a chance to skim, but on page 9, it says, "A school employer may provide medical, optical, or dental benefits to school employees and their dependents." I would normally think that means you can provide insurance. Then a couple of lines later, it says, "A plan under this subdivision does not constitute doing the business of insurance in this state and is not subject to the insurance laws of this state." That seems pretty significant to me. I also have something here from the Michigan State Medical Society and I will just read to you from that. "Physicians and hospitals have experience with undercapitalized insurance companies. When the Medicaid program initially went to managed care, participating plans were not required to maintain comparable reserves to their commercial counterparts. Despite having certification from their actuaries, many of these plans failed." I'm sure we're all familiar with that. "Physicians in hospitals are still in court trying to recoup a fraction of the total amount owed by these plans. In health insurance, a few serious cases can deplete insufficient reserves very quickly. Therefore, MSMS cannot support this provision."

I think that's a significant caution to us and that we should be very careful about what we're about to embark on.

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