"Soft individual mandate" in the healthcare bills raises concern

Lockton Benefit Group is providing employers with a comprehensive, practical view on proposed health reform legislation working through Congress.

For employers, there is good, bad, and ugly in the legislation, according to Ed Fensholt and Mark Holloway, attorneys in Lockton Benefit Group's Compliance Services Division and Lockton's Health Reform Advisory Practice. Lockton is the world's largest privately held insurance broker.

Fensholt and Holloway made the comments during a two-hour webinar, "Into the Maelstrom: The Health Reform Debate Marches On." It is available free online to the public.

Fensholt noted that the bill passed by the House, and the Senate bill now being debated, are "significantly similar." Despite the similarities, Fensholt and Holloway do not expect the debate in the Senate to conclude until early next year.

The Lockton experts noted that both proposals improve access to health care, "take baby steps toward finding a way to pay for quality and encourage proper payments for primary care," and make some insurance reforms to address some abuses.

But they raised concerns about the "soft individual mandate" in the bills. They said this could create incentives for people to pay penalties rather than buy insurance, then buy insurance only when they became ill, adding greater expense for the healthcare system.

Mark Holloway also noted, "Both bills add numerous new administrative requirements that would apply to employers." He expressed doubts that the bills will do much to "bend the cost curve" on U.S. health expenses.