Personal Injury Law

Big Insurance Voices Opposition To Public Plan

By Jane Akre

Big Insurance Speaks Up On Healthcare Reform

Big Insurance has issued a strong statement opposing the public health insurance option promoted by President Obama.

America's Health Insurance Plans, an umbrella group for a number of U.S. health insurers, wrote in a letter to Sen. Edward Kennedy that a public health plan would "dismantle employer-based coverage, significantly increase costs for those who remain in private coverage, and add additional liabilities to the federal budget."

Member groups include Aetna Inc, Humana Inc., Cigna Corp., and UnitedHealth Group.

The Blue Cross Blue Shield Association also doubts a government plan can play on a level playing field with private insurers. 

Speaking to the public Tuesday, the president described the public health insurance option as "an important tool to discipline insurance companies."  He minimized criticism that private plans could be ruined. 

"If private insurers say that the marketplace provides the best-quality health care," pondered the president, "then why is it that the government--which they say can't run anything--suddenly is going to drive them out of business? That's not logical," Forbes reports.

On June 1, in a letter to President Obama, the insurance companies vowed to decrease the annual health care spending growth rate by 1.5 points, saving $2 trillion or more. 

Health Insurance Insider To Testify

On Wednesday, a former insurance executive, Wendell Potter, will testify before the Senate Commerce Committee about the industry's resistance to change.  Potter worked as a public relations expert for two decades for two large health insurers, CIGNA and Humana.  

Potter says he witnessed the for-profit insurers turning health care system into a "giant ATM for Wall Street investors."  He left the industry after seeing practices he felt harmed Americans. 

The Center for Media & Democracy says in a news release, "To him, there was a heart-breaking discrepancy between Americans struggling to find affordable, comprehensive coverage and wealthy insurance executives who based their premium charges - and coverage decisions - on profits rather than people's health care needs. "

Potter believes that by speaking up he might stop the industry-wide effort to derail meaningful reform.

Hearings got underway Tuesday in the House version of the bill, which requires all Americans to purchase health insurance.

Sen. Kennedy (D-MA), chairs the Health, education, Labor and Pensions Committee, which is considering the overhaul legislation. Kennedy, who is suffering from brain cancer and working from home, is considered the key to the health bill. His publicly run insurance option would give coverage to all Americans, including the nearly 50 million uninsured.  

Democrats have issued assurances that a private plan could compete on a level playing field with private plans.  Sen. Max Baucus (D.- Mont.), chairman of the Finance Committee, is crafting his own legislation following a somewhat more conservative path into a centrist direction, writes the Wall Street Journal.

Bacus believes he will achieve bipartisan agreement behind closed doors with what he calls a "coalition of the willing" reports AP.   

Sen. Charles Grassley, a Republican, is reported to be working with Sen. Baucus whose version would not include the publicly run option and coverage for all. 

In opposition, Republicans on the Senate Finance Committee are drafting their own version of reform. The public plan will need to pass a 60 vote threshold in the Senate. 

President Obama has made health care reform the top priority for his administration.  In an address to the nation today he asked, "Why would it (public plan) drive private insurance out of business?"

He said the administration's position just makes sense, though he hasn't committed to a public plan. Forbes reports that President Obama is concerned that crowding out private insurers might mean a public plan could be simply, "eating off the taxpayer trough."

Meanwhile, public polls seem to support the idea of a public plan, despite the $1.6 trillion over ten year cost.  #   

Full post as published by InjuryBoard on June 23, 2009 (boomark / email).