America's health insurance companies today are talking the talk of universal health care. But "Harry and Louise," the insurance industry ad campaign widely credited with killing the Clinton health care initiative in the 90's, remain among the most skilled and secretive knife fighters when the industry's bottom line is threatened. Last week, they moved with stealth and slit the throat of a modest effort by the Department of Veterans Affairs to get insurance companies to pay a small share of the health care costs for veterans who have private health insurance but get treatment at the VA.
Only that's not the way it played in the press. Working through allies, such as the reliably Republican American Legion, the insurers and their allies pushed out talking points that were totally false, making it appear that the Obama administration, which had recently announced a $25-billion increase in the VA's budget over the next five years, was secretly planning to make wounded veterans pay for their care.
Take, for instance, the March 10 testimony of Steve Robertson, Director of the National Legislative Commission of the American Legion, before the Senate Committee on Veterans Affairs. Note how blatantly he turned a fabricated premise - "some talk" - into a chamber of horrors for service-disabled veterans:
Recently, there has been some talk about VA seeking third-party reimbursements from private health care insurers for the treatment of service-connected medical conditions....
Should private insurance companies be required to reimburse VA for the treatment of service-connected medical conditions, The American Legion has grave concerns over the adverse impact such a policy change would have on service-connected disabled veterans and their families. Depending on the severity of the medical conditions, those medical insurance policies with a calendar year benefit maximum or a life-time benefit maximum could result in the rest of the family not receiving any health care benefits. Many health insurance companies require deductibles to be paid before any benefits are covered.In addition, there is concern as to what premiums would be to cover service-connected disabled veterans and their families with private health insurance, especially those who are small business owners or self-employed. The American Legion is also concerned with employers who would be reluctant to hire service-connected disabled veterans because of the impact their employment might have on company health care benefits.
Other groups promptly mimicked the American Legion's stance - and not just the GOP's predictable Obama-bashers. Panicky Democrats weighed in. Even Jon Stewart of the Daily Show, normally one of the best bullshit detectors in the public arena, wound up parroting the same talking points:
Obviously the big story tonight [March 17] ... the AIG bonuses. We don't want to forget the smaller outrages in our world, either. And we won't with a new segment called: "That Can't Be Right."
You know veterans? The men and women who risk their lives defending our country? ... Well, when they get injured, do you know who foots the bill? You! The taxpayer! I know! It's incredibly ... fair! Completely and totally fair.That's why it struck me as a little odd when I read that one of the money-saving proposals from the Obama administration was to remove veterans with private insurance plans from the VA rolls! [Audience boos.]....
What the [bleep] are you guys thinking? Veterans having to use their private insurance to pay for combat-related injuries! That can't be right!
Earlier this month, I pointed out (Will The VA Take On Big Insurance?) in the Huffington Post that the VA was not looking to shift the costs of care to veterans. The goal was to get insurance companies to provide "coordination of benefits" for those veterans who receive care at the VA but also have private health insurance, typically through an employer.
Some 2.2 million veterans enrolled in VA health care also have private health insurance. Private insurers routinely coordinate - meaning share - benefit payments for patients who have multiple care plans - unless, that is, the patient is a veteran treated at the VA.
As the American Legion and other veterans' organizations should know, combat-wounded and other service-disabled veterans who get treated at the VA are in the top priority groups.
They receive inpatient and outpatient care at no cost. No deductibles. No co-pays. Period.
Any coordination of benefits would occur after the veteran received care and would be a transaction solely between the VA and the insurance company. There would no "adverse impact ... on service-connected disabled veterans and their families," as Mr. Robertson fantasized. The only party at risk would be the insurance industry, which loves nothing more than collecting insurance premiums and concocting imaginative excuses for not paying benefits.
Coordination of benefits would allow the VA to recoup an estimated $540 million from private insurers. Set that against the average cost of private health insurance premiums in 2008 of $4,704 for an individual and $12,680 for a family of four. Then, do the math: Divide $540 million by the 2.2 million veterans with private insurance, and you get an average of $245.45 per person.
In short, we're talking here about flu shots, routine exams and the like - not major surgery, followed by months or years of rehabilitative therapy and other costly care.
That $540 million represents less than one percent of President Obama's projected VA budget of $55.9 billion for 2010. But health care at the VA for the lowest priority groups - low-income veterans without service-related disabilities - depends directly on the funds the VA has available for health care. Most of that funding comes from congressional appropriations, but it also includes reimbursement from insurers and other private-sector organizations.
If the VA abandons all pursuit of insurance payments for coordination of benefits, some veterans in the lowest priority group will be turned away. The VA's web site provides this explanation:
By law, the Secretary of Veterans Affairs is required to review, on an annual basis, the patient enrollment system. The purpose of this review is to ensure that adequate resources are available to provide quality and timely health care to all enrolled veterans. When the demand for services exceeds VA's ability to provide such care, the Secretary is required to make enrollment adjustments.
So, by letting the notorious "Harry and Louise" gang and its allies take down a modest initiative to get private insurers to coordinate benefits for veterans who have private health insurance, the end result could well be fewer veterans getting care.
With unemployment and homelessness on the rise in general and among veterans in particular, tens of thousands of low-income veterans will likely wind up without care.
I don't think "single payer" is the solution to all our health care problems. I think Obama's vision of public-private competitions is a very reasonable one. But if the insurance industry is determined to undermine coordination of benefits, then maybe it has outlived its potential usefulness.
And anyone who thinks that this is a bad idea needs to come up with a REAL good reason, since the VA currently only treats those who are 30% service connected or more, or those who can afford it, or those with a purple heart. Everyone else is thrown out.
The $540 million of this debt of honor that the administration wants to stick insurance companies with is $540 million that all those part of the same insurance pool are going to have pay in premiums - only tripled, to cover the added overhead and profit margins. They don't owe this debt and should be stuck with it. The country damn well owes it, and should not be trying to slip the bill under anyone else's napkin.