Monday, October 12, 2009

Insurers Fight Reform -- The Inevitable

It was only a matter of time.

As long as they thought that the costs of health care reform would all fall on the government, the taxpayers, individuals, drug companies, and hospitals, the insurance industry was silent, even mildly supportive.

No longer.

When the Senate Finance Committee cut the penalties people would have to pay if they don't buy insurance, the rumblings started. The penalties went from $950 for an individual and $3800 for a family down to nothing for the first year, and then $200 for an individual and $1900 for a family eventually, on an increasing basis over time.

And the insurance companies started to yelp. If they have to accept people with pre-existing conditions, they need, they say, the young healthy people, too -- the people least likely to buy insurance even if there's a mandate. They'd rather pay the $200 fine than spend $300-$400 per month on a premium. They're young. They're short-sighted. They don't hear the calls I get from young people who found out they had a chronic illness after having foregone health insurance, and now they can't find anything to cover their pre-existing conditions.

The insurance companies were willing to take us sickos as long as they got these healthy kids. But with penalties this low, they aren't assured they'll get the healthy. So now, they don't want to have to take people with pre-existing conditions.

And they hate the tax on so-called Cadillac plans -- plans that cost $8000 per year for an individual and $21,000 for a family. I'm no fan of this tax, either, but that's because I understand that many plans are this expensive because insurers charge groups with sick enrollees more, even if they aren't supposed to. The insurers hate it because the tax is on them, not on the insureds.

And finally, the insurers don't like the cuts to Medicare Advantage plans. That's because private insurers run Medicare Advantage plans. They've been making out like bandits on these plans, getting paid more by the federal government than it costs the government to provide the same services under traditional Medicare. We advocates knew the Medicare Advantage plans were rip-offs because we are the ones who heard from the patients who faced denials of coverage of things that would have been covered by traditional Medicare. Medicare Advantage plans were rip-offs all along. The government finally figured that out and decided to take away their profits. Boo hoo.

Here's what I think. What's bad for insurers is probably good for the rest of us. I'm not overjoyed by the Senate Finance Committee bill, but I'm surely not going to mind at all if the insurers have to feel some of the pain. After all, if they hadn't put profit motive over health all along -- if they hadn't denied coverage to people with pre-existing conditions, if they hadn't denied coverage of things that were life and death necessities -- we might not have needed health insurance reform at all.

Most of us have to live with the consequences of our actions. Sorry, UnitedHealthcare. Sorry, Aetna and CIGNA. So so sorry, Blue Crosses who like to pretend that they're better than the rest but most definitely are not. Sorry you'll have to pay part of the price for the damage you've done.

It was inevitable that the insurers would oppose reform efforts. It only took this long because they really thought they would walk away from this unscathed until the Senate Finance Committee bill was written and then amended. Now that they see the writing on the wall, the inevitable screaming has begun.

Let's see if our elected officials are ready to stand up to them. Jennifer

5 comments:

  1. Jennifer, Thank you for you commentary and explanations of what is happening in washington. I very much appreciate all you work and effort.

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  2. Hey Ms. Jaff, how you doing?

    Just a quick question. Does it seem like your followers are more pro or con for the insurance changes?

    Seems like I've noticed a lot of them against it which boggles my mind...

    Anon ;-)

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  3. Anonymous:

    No matter how controversial I am, we don't get a lot of comments on this blog. I'm not sure why. I like to think that the chronically ill have suffered enough at the hands of health insurers to be in favor of reform. Jennifer

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  4. Hi Jennifer, I don't think there have been many comments pro or con on health reform in this blog. I do think that many folks write about the difficulties they have with health insurance coverage and the difficulty in getting social security disability. I've written to both my Senators in favor of health insurance reform and to my congressman. To be honest, I don't have much energy left after my fight with several chronic illnesses and severe pain. Many hours each month are spent working through my own health insurance coverage disabilities. I'm totally occupied with just trying to survive.

    What I see is that the level of reform is being watered down a great deal. The major provisions of the "Baucus Bill" will not take effect until 2013. It looks like there may not be a public plan option for people to choose. Insurance companies still will be able to discriminate by age and charge older Americans up to four times what they charge younger Americans. I think the "Baucus Bill" makes a big mistake by relying so much on our present for-profit insurers. Frankly, I favor a single payer model that makes my burden of insurance denials and paperwork much less. So, the present leading model bill, the "Baucus Bill" is not the bill I would like to see passed.

    So, I favor insurance reform, but it just seems the likely model coming from Congress just doesn't meet my needs very well. As a person with several chronic illnesses, what comes from Congress may not be better than the private insurance I have now through my employer. I wonder how chronically ill people like me who are uninsured are going to fare in the 3 1/2 years before the major provisions of the bill take effect. Just think, if the bill that passes is very similar to the "Baucus Bill" the chronically ill will have to wait until about July 2013 before the major provisions take effect. Chronically ill people without insurance will be in the same bind they are now. This means they will be excluded from obtaining private insurance because of prior conditions.

    Why not outlaw prior condition exclusions now as well as other onerous private insurance provision like dropping and canceling coverage? It seems a rather simple bill could pretty much level the playing field between insurers and consumers who would like to buy health insurance coverage.

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  5. Frank:

    Not that I agree with this position, but the reason the Baucus bill (and most others) don't eliminate pre-existing condition exclusions is that the insurers successfully argued that it will take time to get the exchanges up so people can buy insurance through the exchange. Since the insurers were able to convince Senator Baucus that they shouldn't have to accept people with pre-existing conditions until the individual mandate is in force so they balance out the sick against the young and healthy. Jennifer

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