Gov. Reeves vetoes two health insurance bills

James Eaton

Gov. Tate Reeves last week axed two health care bills that passed the Legislature with bipartisan support and that health experts say could improve health care. 

Senate Bill 2622 would have sped up the prior authorization process, which insurance companies use to tell providers whether a drug or procedure is covered for certain patients. Reeves said while the bill itself was a “good idea,” he referred vaguely to mistakes in its language, including that administrative hearings were in “an incorrect place in the bill” and what he said would be increased costs for Medicaid as his reasons for vetoing. 

Senate Bill 2224 would have given State Insurance Commissioner Mike Chaney the authority to study and address inequalities in insurance reimbursement rates, which Reeves said was a “bad idea.” The commissioner would be able to fine insurance companies up to $10,000 per violation if they’re unable to justify unequal reimbursement rates for different hospitals for the same procedures. 

“It allows us to put some sunshine and open transparency on Blue Cross Blue Shield,” Chaney said. “We’re trying to figure out where all the money goes. They say, ‘We don’t have to tell you that.’”

This became a major issue last year when the University of Mississippi Medical Center, the state’s largest hospital and only children’s hospital and organ transplant center, went out of network with Blue Cross, the state’s largest private insurer. The dispute between the two stemmed from the insurance company’s reimbursement rates.



State Insurance Commissioner Mike Chaney addresses the audience in the pavilion at Founders Square at the Neshoba County Fair. on July 27, 2016, in Philadelphia, Miss. Credit: Rogelio V. Solis, AP

Blue Cross did not respond to multiple requests for comment. 

In his veto messages, Reeves said he believes the bills would increase the cost of health care. 

When asked whether the governor had data to back up his claims, Reeves’ press secretary Shelby Wilcher said his understanding that the bills would increase health care costs is rooted in “basic economics.”

“If the cost to provide the service increases, such increases (sic) will be passed along to the consumer,” she said. “The bills contained numerous costly additional burdens, heavy fines, and mechanisms for forced rate increases that would all have an inflationary effect on health insurance.”

It is unclear how the bill that would speed up the prior authorization process would increase costs.

Tim Moore, executive director of the Mississippi Hospital Association, is still confused about Reeves’ claim. 

“Where is the data that supports the claim of higher health care costs? I do not see that,” he said. “Interesting that it is two health care related bills that are the first to be vetoed.”

Chaney last year advocated on behalf of consumers when UMMC went out of network with Blue Cross. He said it’s always been his job to monitor the equity of reimbursement rates to providers and its effect on consumers, and this bill would’ve given the commissioner’s office more teeth in its ability to regulate companies.

“I should say that the governor’s veto is a very bad idea because it hurts consumers and health care providers,” he said. 

This bill would have allowed Chaney to enact rules and regulations and gather data about how insurance companies reimburse different providers for different services, which is currently not easily accessible or equitable, and study how consumers are treated based on their plans.

Chaney said Blue Cross reimburses providers in Tennessee at higher rates, despite consumers in Mississippi paying comparable premiums. 

“BCBS administers those premiums and those policies in Mississippi at lower reimbursement rates,” he said. “Blue Cross won’t give us that information. It’s that simple.”

A study by consulting group Milliman estimates that Mississippi is reimbursed on average at the lowest rate in the country by commercial insurers compared to Medicare. 

In addition, consumer experts say Blue Cross in Mississippi has the financial means to pass savings on to consumers but has not. A Mississippi Today investigation last year found that the company has accumulated far more than what regulators require, and perhaps the largest such surplus by percentage of any Blue Cross company in the country at about $750 million. 

As for mistakes in SB 2622, Reeves’ inability to name more than one specific error concerns Angela Ladner, executive director of the Mississippi Psychiatric Association and Mississippi Oncology Society. 

“When you say there’s a mistake, you need to be really specific about what you’re talking about,” she said. “As far as content, I’m not sure that there were a lot of mistakes. I think the Department of Insurance worked significantly hard to make sure that the bill was in a format that everybody agreed upon, and that’s why they passed it.”

And despite being passed overwhelmingly by the House and Senate, it is unclear if the Legislature will attempt to override the vetoes, which would take two-thirds majorities in both chambers. 

Sen. Hob Bryan, a Democrat who represents Amory and chairs the public health committee, said he was not aware of any override attempts and that he could not understand why the governor vetoed the bills. 

Leah Smith, a spokesperson for Lt. Gov. Delbert Hosemann, who leads the Senate, said Monday that his office continues to review the veto messages. 

A spokesperson for House Speaker Philip Gunn did not answer questions for this story. 

Wilcher said via email that the governor’s office is hopeful that the Legislature can come up with an improved version of the prior authorization bill. 

“This is unfortunately the victim of a strong lobby by health plans and insurance companies that are saving money on the backs of the patients that they’re supposed to be serving,” Ladner said.

In 2022, the most recent year for which data is available, Blue Cross spent a total of $82,000 on lobbying.

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