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Health Insurance Reform Increasing Access, Cost

Health Insurance

The battle for affordable health insurance reform is heating up in Washington. Following the Congressional Budget Office's analysis of Senator Kennedy's (D-MA) health care reform bill the White House has sought to separate itself from the bill. The CBO estimate put the cost of the bill in excess of $1 trillion over the next decade.

Health insurance reform is key to any plan according to President Obama.

Kathleen Sebelius, Secretary of Health and Human Services, states a government-run public option insurance plan is needed to create competition. President Obama and Sebelius have said the government-offered plan would be subject to the same rules that currently govern private health insurance providers. With more than 1,000 private insurers nationwide the White House has not explained how adding one more provider, that they claim will follow the same rules, will create competition.

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Obama and administration officials have used straw-man arguments against GOP politicians, physicians, and others currently opposed to the prevailing reform plan. The President claims the cost of doing nothing will far exceed any price tag attached to reform plans by the CBO. Leading GOP officials and physicians alike are not declaring nothing be done. Those opposed to the plan are worried a government-run health insurance plan will drive private insurers out of business.

President Obama, speaking yesterday to the American Medical Association, reiterated his point that Americans satisfied with their current health insurance plans will be allowed to keep that coverage. What worries some is the fact that a government run option could create false price floors, setting rates below what private insurers can compete with, thus driving them out of business and decreasing competition. This worry leads to the fact that if the government controls your insurance then they also control your health care in general.

Sebelius told reporters the government-provided public option is primarily needed in states where competition is lacking. The HHS Secretary says like her home state of Kansas, many states have primary health insurance providers, stifling competition. However, limiting and outlawing interstate sales of health plans is the real reason behind lacking competition in such areas. There is no discussion of allowing such sales in current legislation.

Another little reported fact concerning the Kennedy bill comes from section 133 of the bill. In this section, current union health care programs are grandfathered into the government's health care plan. President Obama told the AMA on Monday that action for health care reform must be quick lest the United States economy go the way of General Motors. In the speech the President blamed GM's health insurance liabilities as a major culprit of the U.S. automaker's downfall. With that being the case, keeping union health care plans is illogical.

In an interview with NPR, Sebelius discarded the notion that a government-run health insurance plan is a trojan-horse for an eventual single-payer system. She again did not explain how adding one more provider to the mix of thousands of insurers will create better competition. Private health insurance companies are likely to continue the fight against any government-provided public option over fears of market share loss and eventual bankruptcy. Physicians are likewise concerned over no discussion of tort reform and the possibility of additional bureaucracy with more government-run programs.



I sit on the board with Utah association of Health underwriters and http://www.BenefitsManager.net as well as http://www.HealthInsuranceSource.net for health insurance reform. Several interesting changes took place with H.B. 188 passage earlier this year that seems all too familiar on the federal level. The spirit of the bill allows private market place remedies. It essentially guarantees insurance providers a "no loss" or "no gain" over competing carriers in the insurance exchange portal which is http://www.UtahInsuranceExchange.info. On the surface it seems not to be attractive to participating carriers (voluntary at this point). But you have to understand the carriers’ goal is to cover their administration fees. That can be accomplished now. The other half of the equation is providers and their billing practices that need to be reformed. That is on the agenda. Keep an eye on Utah because the national health care debate seems much the same ground we have already covered. In http://www.UtahInsuranceExchange.info which is the beginning of a state sponsored program addresses issues on a local state level that the federal level might look at. Coming from an underwriting background I know where the dime falls. I am of the opinion that large waste occurs from providers billing for procedures that developed "no outcome". Insurance carriers are not the only bad guys on the block. In most of our purchasing decisions....don't we pay ONLY when we know that we will get a desired outcome? Why is it if you ask the doctor how much this test or procedure is he doesn't know? Shouldn't providers be held to a transparent cost standard? You must be in the health care business from some touch point to make statements of fact in face of historical proposed changes. When you are in the system from any touch point (insurance, provider, hospital, Medicare or patient) you get it because of real time experience. I often quote the Switzerland health care system as an example of tough questions that we will have to face at some point down the time line. Did you know that premature babies there are not resuscitate upon birth if they cannot draw breath? Did you also know that is the same with senior care with system failure? They don't extend life of a senior with multiple failures like intubation as example. Anyone in the business of paying claims knows that single most expensive bill in NICU for newborns and seniors in acute intensive care / hospital. These decisions were made based upon cost vs. quality outcome. Are we as a nation prepared to make that type of decision or definition of when to incubate a newborn or a senior? To define the conditions? With a litigious society I think not. This is why we need tort reform. Without tort reform medical provider costs will never drop. Liability costs with medical providers are nearly half of operating expenses. With health insurance carriers it translates to about 10% of every premium dollar collected. I don't think we are hearing about tort reform because most of the house and senate are lawyers. In the healthcare system there is no total innocence. Insurance executives with bonuses, doctors overbilling, hospitals overbilling because the street gang thug got dropped at their door with no insurance.