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Ethan Rome Headshot

Don't Be Fooled By the Big Insurance Companies

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Health insurance giants UnitedHealth Group, Aetna and Humana have announced that regardless of how the Supreme Court rules in the Affordable Care Act case this month, they will voluntarily continue some important consumer protections created by the law. These include preventive health care services without co-payments, coverage of children up to age 26 and elimination of lifetime policy limits. The Blue Cross Blue Shield Association is also encouraging its member companies to consider following UnitedHealth's lead.

This would seem to be a good thing, and some are praising these companies. But no one should be fooled. This didn't happen out of the goodness of the insurers' hearts. This isn't about corporations doing the right thing. And it didn't happen now, just a few weeks before the Supreme Court announces its ruling, by coincidence.

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This is a PR offensive. The coordinated announcements by three of the five biggest health insurance companies is a cynical tactic to signal to the high court that it's okay to gut the law and remove its consumer protections because the health insurance companies will act responsibly and police themselves. No more insurance company abuses. The free market won't cost consumers their health anymore. The insurers' message to the court, it would seem, is that it's a new day so we can stick with the old rules.

The insurers also are trying to give cover to the Republicans in Congress, who are sweating about what to do if the high court strikes down all or part of the law, including the consumer protections that people are getting used to and really like. The question has already split the GOP caucus because their mantra of "repeal Obamacare" also means taking away the popular parts of the law. Now the insurance companies are making it easier for the Republicans by saying they'll continue a few of the good things without the law.

But the insurance companies are only talking about voluntarily extending a few of the benefits they are now required to offer. This won't cost them a nickel because the benefits were cost-efficient to begin with and are already baked into their premiums. The families and businesses that purchase health insurance expect to have these benefits and insurers, not wanting to look like the guilty parties, won't yank them mid-policy year. This neatly solves their PR problem, at no cost to the CEOs and shareholders.

What the insurance companies didn't say -- and what they won't do -- is the real story. They aren't saying they will stop discriminating against people with pre-existing conditions as the law requires beginning in 2014. That would be a big deal, because that part of the law will stop 129 million people with chronic conditions like diabetes, high blood pressure and asthma from being over-charged or being denied coverage. They also have not offered to keep covering children with pre-existing conditions -- a provision which has already taken effect and insurers have fought.

The insurers got publicity this week for appearing to make a positive gesture, but the changes they've announced are voluntary, meaning consumers and small businesses can only count on the policies to last as long as it's financially convenient for the insurers. But goodwill gestures aren't enforceable when you're sick. Insurance companies can't be trusted to behave as good actors unless laws are on the books to prevent them from being bad actors.