Health Insurance Industry To Make It Easier For Individuals To Obtain Coverage

Armen Hareyan's picture

America's Health Insurance Plans on Wednesday will present aproposal that is intended to increase access for people seeking to purchasehealth insurance on the individual market, including those who previously havebeen denied coverage because of health issues, the New York Times reports. The proposal was draftedby a group of insurance executives.

The proposal "signals a willingness by insurers to abandon practices thathave seemed aimed at excluding all but the healthiest individuals," the Timesreports. Under the plan, strict guidelines would be enforced to make it moredifficult for insurers to withdraw or deny coverage to individuals withpre-existing health problems. It also would limit the cost of premiums thatsuch people could be charged.

In addition, the proposal urges states to offer individual policies for peoplelikely to sustain exceptionally high medical bills. States would be called onto provide coverage for any individual whose medical costs are projected to beat least twice the average. For higher-risk people who do not meet thatcriteria, insurers would agree to cap premium levels at 150% of the marketrate.


It is unclear how many additional people would be able to obtain insuranceunder the proposal, and the group did not offer estimates on cost. According toa new AHIP survey scheduled to be released Wednesday, about 11% of all peoplewho currently apply for health care are not offered a policy after theirmedical status is reviewed by insurers. About 30% of all applicants in their60s who do not yet qualify for Medicare are denied coverage.


AHIP CEO Karen Ignagnisaid, "We are taking responsibility for ensuring that no one falls throughthe cracks."

Wisconsin-based Assurant Health CEO Don Hamm, who was among theexecutives who drafted the proposal, said, "The individual market isrecognizing that we need to improve the way we do business today."

Jay Gellert, CEO of California insurer Health Net and another panel member, said, "This isa far-reaching proposal that responds to the concerns that people haveappropriately raised." Gellert said that independent insurers could makethe proposal work if there are enough people who can benefit from it, adding,"If a state or the government is committed to universal participation, youcan have a viable market and take all comers."
Paul Ginsberg, president of the Center forStudying Health System Change, said, "The health insurance [industry] is coming to grips withthe fact that practices that are clearly driven by market forces are giving theindustry a black eye." The Times notes that the insuranceindustry "is also trying to have a greater say in any state changes thatmay be enacted" (Abelson, New York Times,12/19).

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