The House passed legislation that would allow small businesses to pool employees across state lines in association health plans, a controversial model of health coverage that opponents contend would destabilize the insurance market. The vote was 252-162. Similar legislation passed the House last June but died in the Senate. President Bush and many business groups support AHPs as a way to reduce the number of uninsured by giving small businesses the leverage to buy insurance at lower rates or to self-insure. AHPs would be overseen by the U.S. Labor Department and would be exempt from state benefit mandates and guaranteed-issue laws. Insurance groups and at least one small-business coalition contend that as a result, AHPs would raise costs in the traditional insurance market.
Cap bill heads to Senate
The House passed legislation limiting noneconomic damages in medical malpractice lawsuits to $250,000. The vote on the GOP-backed bill was 229-197. The same bill passed the House last year but failed in the Senate. It must face the Senate again to become law. Republicans have made malpractice reform a top priority, though efforts to pass legislation have failed twice so far this year in the Senate.
Hospital prices climb
Wholesale prices for general acute-care hospitals rose 0.5% in April after a 0.1% increase the previous month, while physician prices rose 0.3% after a 0.2% decline in March, according to the Bureau of Labor Statistics' Producer Price Index. Both lagged behind prices for finished goods, which rose 0.7%. Hospital prices were 5.3% higher than a year earlier, while physician prices were 2.2% higher.
Amerigroup nixes deal
Amerigroup Corp., Virginia Beach, Va., will not buy 103,000-member Wellness Plan, Michigan's largest Medicaid HMO. Amerigroup had agreed in April to pay $38 million to purchase the Detroit-based plan, which has been under state control since entering court-ordered rehabilitation in July 2003.
Brown exits Ariz. system
After nine months as president and chief executive officer of Northern Arizona Healthcare, a two-hospital system in Flagstaff, Fred Brown has stepped down for personal reasons, according to the Associated Press. Brown, the 1999 chairman of the American Hospital Association, had been president and CEO of BJC HealthCare in St. Louis from 1993 to 1998. Jim Puffenberger is replacing Brown at Northern Arizona, which oversees Flagstaff Medical Center and Verde Valley Medical Center in Cottonwood, Ariz.