Health Insurers Make Pitch For Mandated Coverage

WASHINGTON — The health insurance industry said Wednesday it will support a national health care overhaul that requires them to accept all customers, regardless of pre-existing medical conditions _ but in return it wants lawmakers to mandate that everyone buy coverage.

Lawmakers have signaled their intent to craft health care legislation early next year, and the insurance industry's support would make passage easier. That legislation is expected to closely track the proposals of President-elect Barack Obama. However, Obama separated himself from his Democratic challengers by opposing an individual mandate for adults to buy health insurance.

More lawmakers may agree to a mandate if it means the insurance industry will back those efforts. They'll remember it was the industry's opposition 15 years ago that helped scuttle former President Clinton's health plan.

The board of directors for America's Health Insurance Plans agreed to the trade-off Monday night. The board endorsed the proposal after a series of hearings in various states.

"We hope this will be a contribution to help members of Congress fashion their proposal," said Karen Ignagni, president and chief executive officer of the trade group. "We're going to provide all the technical background that we have assembled, all the experience we've assembled at the state level, and we're going to work very hard with members of Congress on both sides of the aisle. We want to make sure that whatever reforms are advanced, no one falls through the cracks."

Obama's health plan calls for a health insurance exchange, a sort of government-run shopping center where customers could go to select from private plans or a plan administered by the federal government. Any insurer that wants to participate in that exchange must accept all customers regardless of pre-existing health conditions, such as diabetes or heart disease.

Insurers will want to participate in the exchange because government subsidies will make it easier for millions of people to buy coverage from them. But the insurers say experience in the states shows the coverage guarantee often makes it harder for people to find coverage. That's because insurers raised premiums to meet the expense of covering all applicants with chronic health conditions.

"They ended up making the problem much worse," Ignagni said of the state efforts. "The data is clear about the need to have everyone part of the system."

Analysts say Massachusetts is an example where the coverage guarantee has worked well, but it's also a state that requires everyone to buy health coverage or suffer a tax penalty.

Some key Democratic lawmakers have already expressed support for an individual mandate. The concept was a centerpiece of Sen. Hillary Rodham Clinton's health care plan. It was also part of the blueprint offered last week by Sen. Max Baucus, chairman of the Senate Finance Committee.

Chris Jennings, senior health care adviser in the White House during the Clinton years, said it remains to be seen whether the industry will support other key components of health care reform. Nevertheless, he called it an important contribution to the coming debate.

"It sends the signal that broad health reform can happen," Jennings said. "There are so many in Washington who are the gloom and doom prophesiers who believe it's impossible."

However, Consumer Watchdog, a consumer advocacy group, called the insurers' position self-serving.

"If consumer's can't afford coverage or refuse to buy it, they'll face tax penalties. Turning the U.S. government into a collection agency for for-profit health insurers is not universal health care, its full employment for HMO executives," said Jerry Flanagan, the group's health care policy director.

Comments

[4all]

Take a look at the big picture. Today"s health insurance industry is BIG BUSINESS. The companies make huge profits and their CEOs make millions, while the rest of us, employers and workers alike, face skyrocketing healthcare costs, impossible bureaucracy, and life-diminishing insurance denials.

HEALTH INSURANCE COMPANY PROFITS IN 2007:

1. UnitedHealth Group -- $ 4,654 BILLION. UnitedHealth Group owns Oxford, PacifiCare, IBA, AmeriChoice, Evercare, Ovations, MAMSI and Ingenix, a healthcare data company

2. WellPoint -- $ 3,345 BILLION. Wellpoint owns Blues across the US, including Anthem Blue Cross Blue Shield, Blue Cross Blue Shield of Georgia, Blue Cross Blue Shield of Wisconsin, Empire HealthChoice Assurance, Healthy Alliance, and many others

3. Aetna Inc. -- $ 1,831 BILLION

4. CIGNA Corp -- $ 1,115 BILLION

5. Humana Inc. -- $ 834 million

6. Coventry Health Care -- $626 million. Coventry owns Altius, Carelink, Group Health Plan, HealthAmerica, OmniCare, WellPath, others

7. Health Net -- $ 194 million

We could use the insurance company profits to provide healthcare for millions of people, and to pay primary care physicians adequately for their work. Yet we need integrity by the payers and not greed and corruption.

Get the insurance companies OUT of healthcare. We need a SINGLE-PAYER system NOW.

HEALTHCARE SHOULD BE A RIGHT, NOT A BUSINESS.

FOR MORE INFORMATION, SEE: http://www.healthcareforamericanow.org/
and http://www.insurancecompanyrules.org/

[sudeki]

Hei... I read your information from begining to the end and I think that is interesting information.. I think i will tell this information again to my friend and I hope this information will be usefull for them... oh yes I suggest you to check my blog on www.top-autoinsurance.blogspot.com , I hope the article on my blog will be usefull for you... and we can share each other. thank you... ;-)

[gdaerin]

so we should cater our legislation to the thugs who are currently strangling our health care system.

I want healthcare coverage, but even if it is only 5 bucks a month I REFUSE to be forced into buying health insurance.

Yes, if you want to drive you have to insure your car, but then you can always choose NOT to drive,

where would the freedom of choice be in this scenario?

If I don't want to live I can just NOT by healthcare,

hell no, I'll move to Canada first

[rjf7r]

so exactly what kind of health care does an insurance company provide?

[unscum]

Yes, mandated coverage, that's what Hillary Clinton was talking about, that will certainly line the pockets of health insurers and the health care professionals that work for them. If there isn't a robust market for people to pick and chose health care coverage, there is no incentive to reduce costs. Health insurers would certainly grab at tax payers money dumped into their bank accounts to insure the uninsured. Something has to be done about rising healthcare costs.

[Antifascist-08]

There is no such thing as a robust market of choice in the health care business. There never has been. Mostly there is just choice of bloated plans and some rip off companies.

Obviously, the mandated plan will be just part of an overhaul that will be needed to bring costs down while maintaining high levels of true research and development as well as service. There are a lot of areas where the "health care" system needs to be "adjusted."

The fact that the health care "industry" and the insurance people are expressing interest in this is an interesting first step, but you can bet that they will be looking for a way to keep their stranglehold on access and pricing of the system if they can.

I don't trust them one bit and I doubt anyone else with any sense does either.

[bthechangeyouseek]

However, Consumer Watchdog, a consumer advocacy group, called the insurers' position self-serving.

"If consumer's can't afford coverage or refuse to buy it, they'll face tax penalties. Turning the U.S. government into a collection agency for for-profit health insurers is not universal health care, its full employment for HMO executives," said Jerry Flanagan, the group's health care policy director.

Mandated coverage will not solve the problem. Insurers should participate and offer solutions, but should not be designing the plan. They have to look out for own interest. We need to get away from HMO philosophy. It is not transparent, and it eliminates choices in medical care not insurance.

[BLinCincinnati]

You have no clue what you are talking about. Auto Insurance is mandated. There is PLENTY of incentive for the companies to reduce costs and be competative. Hell, it's one of the most competative industries, and the premiums are very low because it's mandated. You don't have millions of people milking the system by not having coverage and going to emergency rooms forcing those that do have coverage to pay for it.

If you don't have car insurance and you wreck your car.... you don't get repaid... and you probably get a fine/jail time or lose your license too.

[Lady Rose]

I am by no means an expert - but looking at it just from the this information, it makes sense that everyone should have insurance - and it should be mandated - as long as the rates are based on the person's income, and in some circumstances the cost may be very very low (i.e. someone who is unemployed, a single mom without a job, etc.) because the person just doesn't have the funds. And if it is mandated there of course needs to be options as to how much coverage you have - so you can select from a bare minimum to a maximum level of coverage - for example having a co-pay of only $10 you pay a bigger premium, but with a larger copay of say $100 your premium is less.

If you have a car - you have to have insurance - or you don't drive. Well everyone has a body, and if something goes wrong - you end up needing medical care and someone has to pay for it. We all need health insurance, so I don't see any reason why if mandating makes it possible, then mandate it - just because someon says Oh I will never get sick and doesn't want it - well guess what, maybe you won't get sick, but you could still break a leg, slip on the ice, etc. - so that person could just get the bare minimum coverage.

[AngelaQuattrano]

It's not going to be progressive. The uninsured are going to be hit with a giant tax bill to cover the plan that the insurance companies are going write into the law. My guess is that it will cost $2500 per person and essentially pay no benefits, except to the insurance companies. Health insurance does not equal health care.

The problem with health care in this country is that the insurance companies are bleeding us dry while pretending to cover the health care needs of part of the population.

http://www.dailykos.com/storyonly/2008/11/19/122213/20/522/663589

[bthechangeyouseek]

I think Obama has a plan that will insure everyone. I also believe that this is the first phase of phasing out private insurers within a few years. There is no reason for an insurance company to exist other than profits. Profits come from negotiating the lowest fees with providers, hospitals etc., and then paying out the least amount in claims. The more healthy people who pay premium, the less cost to the plan. We should socialize insurance and make greater choices with technology on providers. Health care is a right not a privilege.

Until we eliminate waste in administration, errors, and unecessary R&D, we will always have increasing trends in insurance costs.

[ab0si]

I worked in medical insurance for 30 years (pricing and underwriting). I hate to agree with the AHIP, but they are completely correct. Mandating availability while not mandating coverage simply will not work. It simply can not work. Anti-selection (those who need the coverage the most will buy it while those needing it the least will not) creates a cost increase spiral that reinforces itself.

Of course, a better answer is a one-payor system but that is a different issue.

Paul

[bthechangeyouseek]

As an agent, I was skeptical of single payer, but the more I read about it, it is the best solution to cover all and reduce costs. Mandating everyone buy will not work: spouses work for different employers, children are covered in some states to age 25, 26 while other states won't cover unless child in college then, only until age 23. There will always be adverse selection when the plans are different, and insurance carriers who negotiate the best price for care will always get the better selection or those who can afford. I think there is a role for private carriers to participate in a single payer system, but then the reason for being in business is gone.