House Bill 346 passed the North Carolina House this week, and if it becomes law, it would be a major step forward in removing burdensome regulations for some nonprofit health plans. As a result, it’s likely healthcare quality in North Carolina would improve and costs go down.

The bipartisan legislation, titled the “Reorganization and Economic Development Act,” removes government red tape that prevents certain nonprofit health plans from using the full extent of their resources to improve care and lower costs. As it stands today, these nonprofit organizations cannot use their resources to act in the best interests of healthcare consumers without first getting permission from government regulators.

A key to the bill’s impact on improving healthcare was ensuring that, once the overregulation is removed, any investments made must be investments that are aimed to improving healthcare, increasing access, and lowering costs.

It’s a point the bill’s author, Rep. John Bradford, R-Mecklenburg, has championed since day one.

“This is about removing red tape that prevents investments that could improve the quality of people’s healthcare and lower their costs,” Bradford said last month. “The final bill will ensure consumers are well protected and can receive the highest quality healthcare services possible.”

Bradford delivered on that promise with an amended bill in committee.

As amended, the bill:

  • Ensures investments promote affordability, access, better health, or consumer experience.
  • Ensures organizations maintain their mission-focused non-for-profit status.
  • Requires public disclosure of investments.

While some have argued that this legislation would lead to premium increases, the bill retains the Insurance Commissioner’s authority to approve or deny rates.

“I don’t understand the ‘it is gonna increase rates’ argument when the commissioner of insurance, whomever that may be in the future, still has to give approval on any rate increase,” said Sen. Jim Perry in a tweet.

These comments are in response to N.C. Insurance Commissioner Mike Causey’s opposition to the bill. Causey has argued the bill would make premiums go up. But health care leaders at the General Assembly like Perry are saying the opposite.

Health Committee Chair Rep. Donny Lambeth said the same during the Insurance Committee meeting that gave the amended bill a favorable report.

“I don’t see any reason it will cause premiums to go up,” Lambeth said. “I think it will do the opposite. I think it will cause premiums to go down.”

The bill now heads to the North Carolina Senate. Hopefully General Assembly leaders continue their history of cutting government regulations and pass the bill. It’s a proven way to improve quality and lower costs.