Health care reform in the U.S. will have to take the form of a public/private partnership, with elements from each sector combining to satisfactorily provide for the coverage of all Americans, the president of an insurance industry trade association said Monday.

At the Montana Healthcare Forum sponsored by Blue Cross and Blue Shield of Montana along with Carroll College, America's Health Insurance Plans CEO Karen Ignagni said her member groups are easy targets for politicians but aren't the root of the growing dissatisfaction with the country's health care system.

"I think we're going to have a mixed system (public and private), and we have to figure out how to get the best of both," she said. "Clearly our country has got to get over simply talking about premiums and health plans. We have to look at the underlying costs and figure out what's needed going forward."

Ignagni said that of every health insurance dollar spent in the U.S., only 14 cents go to pay for claims processing and administration, consumer services and profits, with 86 cents paying doctors, hospitals, pharmacies and other medical services.

"The fact of the matter is, our premiums track costs," she said. "The cost of paying claims has declined in the past 10 years."

Another reason costs are climbing is that Americans are less healthy than Europeans, she said, with higher incidence of heart disease, high blood pressure, cancer, diabetes and obesity.

When considering health care reform, Americans will face decisions on a number of fronts, Ignagni said. Should more emphasis be placed at the federal or state level? Should the initial effort concentrate on insuring children or adults? Should coverage be mandated? And if so, should the mandate call basic or comprehensive coverage? And is the onus on employers or citizens?

Voter enthusiasm (or lack thereof) will help determine which way the country goes, she said.

"Individuals, if they're going to be required to purchase or fund subsidies for purchase, folks are going to ask, 'What do I get? Are we subsidizing the right people?' " she said.

At the state level, Ignagni noted that 17 percent of Montanans have no health insurance, including 19 percent of people under 50. The state can consider a number of approaches to broaden the coverage of its citizens, including subsidizing health coverage for those under certain income levels, offering similar subsidies to employers to make workplace plans more affordable and improving the safety net for those at the bottom of the income chain.

Ignagni pointed out that the numbers of insured people are lowest at the country's smallest companies, a trend that's exacerbated in Montana where so many people work in small shops. Between 12 and 14 million Americans decline the health insurance that's offered through through their workplace because they can't afford it, which accounts for nearly a third of the uninsured people in the country.

Reporter John Harrington: 447-4080 or john.harrington@helenair.com