Advertisement

Archive for Tuesday, October 13, 2009

Health insurance firms’ warning shot has Democrats scrambling

October 13, 2009

Advertisement

— Insurance companies aren’t playing nice any more.

Their dire message that health care legislation will drive up premiums for people who already have coverage comes as a warning shot at a crucial point in the debate and threatens President Barack Obama’s top domestic priority.

Democrats and their allies scrambled on Monday to knock down a new industry-funded study forecasting that Senate legislation, over time, will add thousands of dollars to the cost of a typical policy. “Distorted and flawed,” said White House spokeswoman Linda Douglass. “Fundamentally dishonest,” said AARP’s senior policy strategist, John Rother. “A hatchet job,” said a spokesman for Senate Finance Committee chairman Max Baucus, D-Mont.

But the health insurance industry’s top lobbyist in Washington stood her ground. In a call with reporters, Karen Ignagni, president of America’s Health Insurance Plans, pointedly refused to rule out attack ads on TV featuring the study, though she said she believed the industry’s concerns could be amicably addressed.

At the heart of the industry’s complaint is a decision by lawmakers to weaken the requirement that millions more Americans get coverage. Since the legislation would ban insurance companies from denying coverage on account of poor health, many people will wait to sign up until they get sick, the industry says. And that will drive up costs for everybody else.

Insurers are now raising possibilities such as higher premiums for people who postpone getting coverage, or waiting periods for those who ignore a proposed government requirement to get insurance and later have a change of heart.

The drama threatened to overshadow today’s scheduled vote by the Senate Finance Committee on a 10-year, $829-billion plan that Baucus has touted as the sensible solution to America’s problems of high medical costs and too many uninsured.

The Baucus bill is still expected to win Finance Committee approval. The insurance industry is trying to influence what happens beyond the vote, when legislation goes to the floor of the House and Senate, and, if passed, to a conference committee that would reconcile differences in the bills.

It’s at that final stage where many expect the real deal will be cut.

“We’ve got ourselves a real health care shooting war now,” said Robert Laszewski, a former health insurance executive turned consultant. “The industry has come to the conclusion that the way things are going in Congress, we’ll have a ... formula that will be disastrous for their business, so they can’t stand on the sidelines any longer.”

Questions about the technical soundness of the industry analysis by the PricewaterhouseCoopers firm was a big part of the discussion Monday. The release of the study late Sunday on the eve of the federal Columbus Day holiday had Democrats crying foul.

“The misleading and harmful claims made by the profit-driven insurance companies are politicking for corporate gain at its worst,” said Sen. Jay Rockefeller, D-W.Va.

Democrats have reason to worry. Insurance industry opposition helped sink President Bill Clinton’s health care plan in the 1990s by fanning fears that people with coverage would wind up paying more.

Ignagni was unequivocal in her support for the PricewaterhouseCoopers conclusions. The company is “a world-class firm” with “a stellar reputation,” she said.

Late Monday, the accounting firm issued a statement acknowledging it did not look at the entirety of the legislation, only the effects of four provisions that the insurance group wanted analyzed. While not retreating from its findings, Pricewaterhouse-Coopers underscored an overlooked caveat in its original report: “If other provisions in health care reform are successful in lowering costs over the long term, those improvements would offset some of the impacts we have estimated.”

The firm’s study projected that the legislation would add $1,700 a year to the cost of family coverage in 2013, when most of the major provisions of the Baucus bill would be in effect.

Comments

Richard Heckler 5 years, 2 months ago

http://www.pbs.org/moyers/journal/blog/2009/10/bill_moyers_michael_winship_in.html#more

If you’ve been watching the Senate Finance Committee’s markup sessions, maybe you’ve noticed a woman sitting behind Committee Chairman Max Baucus. Her name is Liz Fowler.

Fowler used to work for WellPoint, the largest health insurer in the country. She was its vice president of public policy. Baucus’ office failed to mention this in the press release announcing her appointment as senior counsel in February 2008, even though it went on at length about her expertise in “health care policy.”

Now she’s working for the very committee with the most power to give her old company and the entire industry exactly what they want – higher profits – and no competition from alternative non-profit coverage that could lower costs and premiums.

A veteran of the revolving door, Fowler had a previous stint working for Senator Baucus – before her time at WellPoint. But wait, there’s more. The person who was Baucus top health advisor before he brought back Liz Fowler? Her name is Michelle Easton. And why did she leave the staff of the committee? To go to work – surprise – at a firm representing the same company for which Liz Fowler worked – WellPoint. As a lobbyist.

You can’t tell the players without a scorecard in the old Washington shell game. Lobbyist out, lobbyist in. It’s why they always win. They’ve been plowing this ground for years, but with the broad legislative agenda of the Obama White House – health care, energy, financial reform, the Employee Free Choice Act and more – the soil has never been so fertile.

The health care industry alone has six lobbyists for every member of Congress and more than 500 of them are former Congressional staff members, according to the Public Accountability Initiative’s LittleSis database.

Just to be certain Congress sticks with the program, the industry has been showering megabucks all over Capitol Hill. From the beginning, they wanted to make sure that whatever bill comes out of the Finance Committee puts for-profit insurance companies first -- by forcing the uninsured to buy medical policies from them. Money not only talks, it writes the prescriptions.

In just the last few months, the health care industry has spent $380 million on lobbying, advertising and campaign contributions. And -- don’t bother holding onto your socks -- a million and a half of it went to Finance Committee Chairman Baucus, the man who said he saw “a lot to like” in the two public option amendments proposed by Senators Rockefeller and Schumer, but voted no anyway.

The people in favor of a public alternative can’t scrape up the millions of dollars Baucus has received from the health sector during his political career. In fact, over the last two decades, the current members of the entire finance committee have collected nearly $50 million from the health sector, a long-term investment that’s now paying off like a busted slot machine.

Richard Heckler 5 years, 2 months ago

Paying More, Getting Less:

How much is the sick U.S. health care system costing you? http://www.dollarsandsense.org/archives/2008/0508harrison.html

By Joel A. Harrison Paying through the Taxman

The U.S. health care system is typically characterized as a largely private-sector system, so it may come as a surprise that more than 60% of the $2 trillion annual U.S. health care bill is paid through taxes, according to a 2002 analysis published in Health Affairs by Harvard Medical School associate professors Steffie Woolhandler and David Himmelstein.

Tax dollars pay for Medicare and Medicaid, for the Veterans Administration and the Indian Health Service. Tax dollars pay for health coverage for federal, state, and municipal government employees and their families, as well as for many employees of private companies working on government contracts.

Less visible but no less important, the tax deduction for employer-paid health insurance, along with other health care-related tax deductions, also represents a form of government spending on health care.

It makes little difference whether the government gives taxpayers (or their employers) a deduction for their health care spending, on the one hand, or collects their taxes then pays for their health care, either directly or via a voucher, on the other.

Moreover, tax dollars also pay for critical elements of the health care system apart from direct care—Medicare funds much of the expensive equipment hospitals use, for instance, along with all medical residencies.

All told, then, tax dollars already pay for at least $1.2 trillion in annual U.S. health care expenses. Since federal, state, and local governments collected approximately $3.5 trillion in taxes of all kinds—income, sales, property, corporate—in 2006, that means that more than one third of the aggregate tax revenues collected in the United States that year went to pay for health care.

Recognizing these hidden costs that U.S. households pay for health care today makes it far easier to see how a universal single-payer system—with all of its obvious advantages—can cost most Americans less than the one we have today.

Medicare must exist in the fragmented world that is American health care—but no matter how creative the opponents of single-payer get, there is no way they can show convincingly how the administrative costs of a single-payer system could come close to the current level.

More on this matter: http://www.dollarsandsense.org/archives/2008/0508harrison.html

National Health Insurance http://www.healthcare-now.org/

Health Care In the USA http://www.dollarsandsense.org/healthcare.html

Doctors for Single Payer http://www.pnhp.org/

Richard Heckler 5 years, 2 months ago

Richard Heckler 5 years, 2 months ago

This is something to never forget. It is the private medical insurance industry that cancels YOUR medical insurance AFTER taking YOUR MONEY for years.

Smart National Health Insurance for All will not only improve our quality of life but also our wallets. Yes we would have more expendable cash for birthdays,Christmas, vacations and investments.

Smart National Health Insurance for All cannot be cancelled

National Health Insurance does not remove competition from the actual health care industry. It will be alive and well. Profits will be based on customer service and clinic performance based on the clients experience. This is my perception of competition.

Flap Doodle 5 years, 2 months ago

The linkbot has woken. Fear his mad copy/paste skillz!

Joe Hyde 5 years, 2 months ago

This isn't cogent to the health care/public option topic -- or maybe it is, given how many people who dislike president Obama are suffering aneurisms at the idea of him having been born in Kenya -- but...

As a nation, the United States of America following its Declaration of Independence existed for 48 years before its citizens elected a president born in this country. That president was Martin Van Buren.

Prior to Van Buren it was, first, George Washington, followed by John Adams, Thomas Jefferson, James Madison, James Monroe, John Quincy Adams, Andrew Jackson. Wow, you shudder to think where we'd be right now had we not entrusted our lives and fortunes to the leadership of those foreign-born U.S. presidents.

I guess what counted most in the eyes of voters back then was their personal assessment of each candidate's ability and character. Whereas the specific place outside the country where the mothers of those candidates had given birth, that probably didn't matter much except maybe to groups of old ladies visiting over their knitting work.

puddleglum 5 years, 2 months ago

tom buddy, come outside and enjoy the fresh air once in awhile, bro.

just_another_bozo_on_this_bus 5 years, 2 months ago

"Democrats and their allies scrambled on Monday to knock down a new industry-funded study forecasting that Senate legislation, over time, will add thousands of dollars to the cost of a typical policy. "

This isn't a study, it's a threat, and is all the more indication that the public option is absolutely necessary.

staff04 5 years, 2 months ago

"While not retreating from its findings, Pricewaterhouse-Coopers underscored an overlooked caveat in its original report: “If other provisions in health care reform are successful in lowering costs over the long term, those improvements would offset some of the impacts we have estimated.”"

A lot said here that's worth repeating. Even the company that AHIP paid to produce a study that was favorable to them can't say it with a straight face...

headdoctor 5 years, 2 months ago

Ah, I see some have realized the power that that insurance companies have and how they exerted control. This isn't new, just not a quiet as with their usual approach.

Just one more reason that the power corporations have to influence Government policy should be taken away from them across the board. I don't have a problem with corporations being considered a separate free standing entity but they should only be looked at as an entity and not one that has the rights in Government like what a person would have.

Yes, I know that is a pipe dream because the relationship between Congress, regulatory agencies and corporations are all in each others pockets for the most part and the people who have the power to change this have no incentive to do so.

georgiahawk 5 years, 2 months ago

Tom, if you were my friend and I heard you saying the stuff you say all of the time on these blogs, I would try to have a serious talk about how this negative, paranoid energy that you spew is affecting you in a very bad way. I hope that you have someone that cares enough for you to have that talk! Otherwise, you are one scarey dude, a firecracker ready to go off!

Satirical 5 years, 2 months ago

Circle the wagons fellow liberals, facts are being reported which contradict our socialist agenda!!!

Here are a few talking points to counter this report.

(1) Attack the messenger by claiming there is a conflict of interest. While it is obviously a logical fallacy to attack the credibility of the reporter rather than the report itself, most people don't see the difference and will ignore the report if we can convince them these companies don't care about anyone or anything but profit and are biased in their reporting.

(2) Use catch phrases to describe the report such as "hatchet job," “Distorted and flawed,” or “Fundamentally dishonest.” Using this sort of rhetoric will make people wary of actually looking at the report itself, but instead rely on their trust of the speaker to decide for them whether this report is legitimate. Avoid at all costs actually debating the merits of this report. Whenever facts are presented, just keep repeating "that's a lie," until you have silenced the opposition.

Satirical 5 years, 2 months ago

Addendum:

Always remember fellow liberals:

Corporation = greedy, evil and doesn't grow by providing goods and services people want, but by holding you hostage.

Government = helpful, caring and doesn't want to expand to have greater control of your life, but because it altruistic.

staff04 5 years, 2 months ago

Satirical:

You forgot "Late Monday, the accounting firm issued a statement acknowledging it did not look at the entirety of the legislation, only the effects of four provisions that the insurance group wanted analyzed. While not retreating from its findings, Pricewaterhouse-Coopers underscored an overlooked caveat in its original report: “If other provisions in health care reform are successful in lowering costs over the long term, those improvements would offset some of the impacts we have estimated."

staff04 5 years, 2 months ago

In your list of talking points, you left out the one that is most likely to give people pause before swallowing the bait.

Of course, if you accept that only the provisions that AHIP asked PWC to look at will be the only portions of the bill that are effective (which, frankly, wouldn't surprise me one bit if you did), then you don't need to think about PWC's qualifying statement.

See, it is a fact that PWC didn't score the other portions of the bill while acknowledging that if they did, the impact would be mitigated...but don't let that rain on your parade!

BigDog 5 years, 2 months ago

AARP is not only a Democratic lobby but they forget that they themselves are a multi-billion dollar insurance company.

AARP heavily pushed the Medicare presciption drug legislation that they benefitted from heavily. They claim it was because of the great benefit it provides seniors .... it was horribly flawed legislation that benefitted their insurance business tremendously.

Satirical 5 years, 2 months ago

Staff04… “In your list of talking points, you left out the one that is most likely to give people pause before swallowing the bait.”

Now I see what you are saying. Thanks for clarifying.

“See, it is a fact that PWC didn't score the other portions of the bill while acknowledging that if they did, the impact would be mitigated…but don't let that rain on your parade!” – staff04

You are incorrectly paraphrasing the quote. The quote said the impact would have been offset IF the other provisions were successful in lowering costs. There is difference between saying, “if we looked at the entire bill our numbers would be different,” than saying “if the other provisions are successful our numbers would be different.”

While I agree this report is a half measure and would have preferred one which analyzes the entire bill, there could be several reasons these mitigating provisions were not reviewed. One reason could be that the bill is a patchwork with handwritten notes, and not everything was available. Another reason could be that these cost saving provisions aren’t quantifiable, or are too speculative. Finally, another reason could be that like Obama claim that most of the plan would be paid by reducing waste from Medicare and Medicaid, it is just B.S.

But what isn’t challenged, and one of the main points to take away from this study, is that if the young and healthy aren’t forced to get insurance coverage soon enough, it will mean higher premiums for everyone else. As I have said before, many of these health proposals are dependent on siphoning money form the young and healthy, and transferring it to the elderly and those who have unhealthy lifestyles. So this is basically a tax on the young and healthy in our nation.

jimmyjms 5 years, 2 months ago

"Circle the wagons fellow liberals, facts are being reported which contradict our socialist agenda!!!

Here are a few talking points to counter this report."

I love it. Conservo-bot taking the side of an industry lobbyist. Who woulda thunk it!

Satirical 5 years, 2 months ago

jimmjms... "I love it. Conservo-bot taking the side of an industry lobbyist. Who woulda thunk it!"

Yes, in your version of reality, anyone who disagrees with the omniscient Obama and the Democrats must have some evil hidden agenda. And anyone exposing the Dems logical fallacies and rhetoric can't be trusted. Please continue to attack the messenger rather than the message. Thank you for using talking point #1.

pace 5 years, 2 months ago

The study should of mentioned that the dream of the health care insurance corporations is to raise the premiums to astronomical heights and deny coverage on any pretense if the health care reforms are not passed. They want to continue doing business as planned. The republican health care proposal includes the plan that the health care insurance industry should be free of state regulations, that it would be good for "us". I can only assume the "us" is the congresspeople and senators and the health insurance corporations that are in bed together.

tbaker 5 years, 2 months ago

Never forget: The looters in DC are far more concerned with protecting the people who pay for their campaigns than they are about us. They'd much rather soak the working folks with generations of debt than upset a big special interest campaign donor. When will they finally figure out that compassion and prosperity are not measured by how many people get a government hand-out, but by how many people there are who no longer need one.

Stop the insanity folks. Vote against EVERY incumbent.

notajayhawk 5 years, 2 months ago

staff04 (Anonymous) says…

"In your list of talking points, you left out the one that is most likely to give people pause before swallowing the bait."

And yet for years, the Lib/Dems have been throwing around that infamous NEJM tripe written by the founders of Physicians for Nationalized Healthcare claiming one third of our healthcare dollars go to administrative costs (often mis-cited as one third going to insurance companies).

THAT study didn't look at several areas of healthcare, including pharmacies, an industry segment with fairly low administrative costs and accounting for a huge segment of our healthcare spending.

THAT study didn't look at any other healthcare providers except physicians - the authors just assumed that the 100 or so other allied health professional fields spend the same amount of time on administrative tasks as doctors.

Or how about PNHP's other study, the one about medically-'caused' bankruptcies? THAT study didn't look at any other source of debt or the relative size of debt. They only looked to see if the bankruptcy included medical bills above an arbitrary level - you could have $5,000 in medical expenses out of a million-dollar total indebtedness, and it was still labeled 'medically-caused.'

Yep, studies like those from PNHP, who self-identifies as a single-issue organization dedicated to instituting nationalized healthcare, are fair and balanced, but a study done by one of the world's most respected accounting/auditing firms is biased because of who paid for it.

Have another glass of kool-aid, kids. Then take a whack at explaining how, if we add in all these people the Dem/Libs keep insisting have no insurance and monstrous levels of medical expenses are added to the pool, with a prohibition against charging them higher rates, somehow the rest of our premiums won't increase?

jafs 5 years, 2 months ago

nota,

Your last question is a good one.

jafs 5 years, 2 months ago

My best guess is a combination of the young healthy folks entering the system and paying into it and some sort of savings by making the system more efficient.

But it's a good question, and should be taken seriously.

jimmyjms 5 years, 2 months ago

"Yes, in your version of reality, anyone who disagrees with the omniscient Obama and the Democrats must have some evil hidden agenda"

Who said anything about an "evil agenda?"

Do you know what a lobbyist does?

just_another_bozo_on_this_bus 5 years, 2 months ago

"But it's a good question, and should be taken seriously."

It's a good question, but one that has been answered in every other industrialized democracy in the world. Are they perfect solutions? No, but much better than the perfect mess we have.

"Wouldn't raising prices cause an increase in competitors jumping into the market thus driving prices back down?"

My question is what's stopping them right now? If the market is the answer, why has their answer left us paying so much for so little?

puddleglum 5 years, 2 months ago

bozo sez: "My question is what's stopping them right now? If the market is the answer, why has their answer left us paying so much for so little?"

thank you bozo. this statement always stumps the 'free-market' argument. I'll go ahead and answer that one for you. The insurance companies have a collective monopoly (an end-game to capitalism, if you will) and they control the prices of the health 'care' by overcharging users and doctors and hospitals all at the same time. It is the problem with capitalism: eventually a small entity gains full control of the market by eliminating competition; usually attained from getting so large of market share that no one else can realistically engage in competition or the preferred method (in the insurance industry's case) of procuring a spot at the top through buying legislators or entire political parties, and making oneself immune from providing the product which one advertises and supposedly sells. Once the entity gets to the top, you just raise prices, and you need not fear of any pesky competition, because you have already protected yourself against that inside the market and outside, well-that is what the best lawyers money can buy will provide (it's called anti-trust lawsuits). Then you sit back and hope and pray that nobody notices.

notajayhawk 5 years, 2 months ago

pooch_person (Anonymous) lies…

"Health insurance 10.6% (9th) revenues 6.4% (16th) assets 19.0% (17th) shareholder's equity"

Nice bending of the truth, dipstick. Did you think we couldn't follow the link to check for ourselves?

The actual line from poochie's link:

9 Insurance: Life, Health (stock) 10.6

As has been pointed out when others tried to use that number, that figure is for health AND life insurance. Life insurance is very profitable since it pays only a fixed amount and only once. Also, in case you didn't notice (which I'm sure you 'accidentally' omitted, just as you left out the word "life"), that profit margin includes only 'stock' insurance companies - i.e., shareholder owned. Mutual insurance companies (e.g. BCBS-KS) wouldn't be included in that figure.

Hmmm - I wonder why the little liar left out those little details? Perhaps because the real numbers don't support his usual delusional, ignorant ranting?

http://biz.yahoo.com/p/522qpmd.html

Industry: Health Care Plans Net Profit Margin % 3.30

But then, what would we expect from someone that didn't know the difference between single-payer and public option?


just_another_bozo_on_this_bus (Anonymous) says…

"It's a good question, but one that has been answered in every other industrialized democracy in the world."

And the answer they came up with is waiting times measured in years for sub-quality care. The perfect solution for an avowed communist like Herr Klowne - everyone equal in squalor.

tbaker 5 years, 2 months ago

Liberty - you are arguing with people who define human compassion and prosperity by counting how many people are dependent on the government for assistance.

Perhaps some day they'll see the light and realize genuine compassion for one's fellow man is measured by how many no longer require government assistance.

Commenting has been disabled for this item.