Horizon, Host: Ted Simons

April 15, 2008


Host: Ted Simons

Crystal Darkness


  • Television stations across the state will participate in the simultaneous airing of the documentary Crystal Darkness. The film reveals the far-reaching problem of methamphetamine addiction. Sergeant Joel Tranter with the Phoenix Police Department joins us to talk about the documentary, the effects of meth use as well as the drug's relation to crime, and child abuse in Arizona.
Guests:
  • Kirk Adams - State Representative
  • Steve Farley - State Representative
Category: Medical/Health

View Transcript
Ted Simons:
Tonight on "Horizon," funding for a state-run health care plan for small businesses is at the center of debate. Plus, we'll hear from a woman who escaped from a polygamist compound. She will talk about polygamist crime in Arizona. Also tonight, the impact of crystal meth addiction on crime and child abuse in our state. Those stories next, here on "horizon".

Ted Simons:
Good evening, and welcome to "Horizon," I'm Ted Simons. We're on an hour early so we can bring you the documentary "crystal darkness" about methamphetamine addiction at 6:30. The "Newshour" with Jim Lehrer will be on at 7:00 p.m. nearly 23,000 are enrolled in a medical plan with healthcare group. The healthcare operated by the Arizona cost containment group. It's for small businesses, state employees, or those who are self-employed. Here with two differing views about healthcare group of Arizona, now representative Kirk Adams and Representative Steve Farley. Thank you both for joining us.

Steve Farley:
Thank you for having us.

Kirk Adams:
Health care of Arizona is a program that was established in the mid 1980s, designed to promote health care coverage to small businesses who otherwise would not be able to purchase that coverage in the marketplace.

Ted Simons:
What is wrong with healthcare group?

Kirk Adams:
For several years the group has been losing a lot of money. It has not produced rates or programs that are financially sound. Up until the year 2006, it was losing about $16 million a year. In 2007, one year, it lost $20 million. So the effort of this bill is to ensure that healthcare group has sound financial management, and that it can continue to serve the population it serves into the future.

Ted Simons:
That sounds reasonable for a program that sounds important.

Steve Farley:
It's a very important program, because it's very hard for any small business, particularly sole proprietors, to gain health insurance in this state. You can't find any insurance that'll cover preexisting conditions. Healthcare group has stepped into the breach to help all these groups to cover their insurance. They have had problems in the last couple of years predominantly because the legislature put obstacles in their way when in 2005 they said, go out and market yourself. They made it much harder for them to be self-sustaining at the same time. Now that they have their house in order and they are doing much better financially, their deficits are much less and they're heading towards a positive cash flow and surplus for fiscal year 2008, we need to get the obstacles out of their way and allow them to grow and become a very strong entity in the future for the sake of our small businesses.

Ted Simons:
Freezing enrollment for three years, something you would like to see. How does the program grow and become self-sufficient with the enrollment frozen?

Kirk Adams:
First you have to do no more harm. We have a freeze placed on the program last year and an agreement with the legislature and the executive branch. We would extend the enrollment freeze, let the dust settle, figure out the financial mess we're in, and then figure out how we can address this population going into the future.

Ted Simons:
Should there not be more regulation, oversight, whatever, just more attention to a program that right now is supposed to be self-sufficient and is not?

Kirk Adams:
There already that is oversight. And the healthcare group administration has done a tremendous job in the past year getting their house in order. They've been doing administrative cost savings, they've been increasing premiums and reducing some benefits, which has been painful but which has increased their financial liability. They are currently losing about 600 members a month because of the premium increases. Many of these people are going on to Access, the state-run Medicaid program. Now we're subsidizing the entire rate instead of premiums placed on health care. We need to take off the enrollment cap so that more businesses can get online. There are currently over a thousand businesses on the waiting list waiting for the enrollment cap to come off, which it will in June of this year if we don't extend the enrollment cap through this bill.

Ted Simons:
Premium increases, enrollment cap. If you can, both?

Kirk Adams:
Absolutely, for the short-term. We have a program here that is bleeding money financially. It lost $20 million in one year. That is a significant loss and puts every single one of those insured's at risk. It's very appropriate to do that. I would point out that to the extent healthcare group is having a better year this year, it's only after we capped enrollment last year and they increased rates.

Ted Simons:
Is there still a situation where you have to be uninsured for six months before you can get into this program?

Kirk Adams:
Yes. Incurred under the program, the period has been in place since 2005. What's interesting about the go bear period, before it was instituted in 2005, under an agreement with the legislature and the executive branch in 2005, healthcare group was still losing an average of $6 million. It lost $51 million when there was no bear period at all.

Ted Simons:
does this period make sense to you?

Steve Farley:
I think not, unless you're a big health insurance company and you're afraid of competition. It means that you have to go without health insurance for six months. Your life may be ruined. You need to get rid of that bear period so we can have other people joining this plan, particularly healthier people who may have an option, joining the plan, to be able to pay in more premiums than they will get back in claims.

Kirk Adams:
Scapegoat aside, it's also important to understand that in 2007, health care group had a 37\% enrollment with the bear period. Any private sector business would be very pleased to have 35\% growth. I would dispute the notion that somehow this period is preventing the program from growing. The most important part about this bill is that it requires the same sort of actuarial soundness that we require in the Medicare system. The program has to be sound. As a state, we're not providing that same quality control for a program that we run. I think we have to do it.

Ted Simons:
We need to stop it right there. Gentleman, thank you so much. Good conversation.

Kirk Adams:
Thank you.

Steve Farley:
Thank you.

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