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Insurers make pitch for health coverage mandate - Yahoo! News
WASHINGTON – The health insurance industry said Wednesday it will support a national health care ...
WASHINGTON – The health insurance industry said Wednesday it will support a national health care overhaul that requires them to accept all customers, regardless of pre-existing medical conditions, but in return it wants lawmakers to mandate that everyone buy coverage.
Lawmakers have signaled their intent to craft health care legislation early next year, and the insurance industry's support would make passage easier. That legislation is expected to closely track the proposals of president-elect Barack Obama. However, Obama separated himself from his Democratic challengers by opposing an individual mandate for adults to buy health insurance.
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More lawmakers may agree to a mandate if it means the insurance industry will back those efforts. They'll remember it was the industry's opposition 15 years ago that helped scuttle former President Clinton's health plan.
The board of directors for America's Health Insurance Plans agreed to the trade-off Monday night. The board endorsed the proposal after a series of hearings in various states.
"We hope this will be a contribution to help members of Congress fashion their proposal," said Karen Ignagni, president and chief executive officer of the trade group.
"We're going to provide all the technical background that we have assembled, all the experience we've assembled at the state level, and we're going to work very hard with members of Congress on both sides of the aisle. We want to make sure that whatever reforms are advanced, no one falls through the cracks."
Obama's health plan calls for a health insurance exchange, a sort of government-run shopping center where customers could go to select from private plans or a plan administered by the federal government. Any insurer that wants to participate in that exchange must accept all customers regardless of pre-existing health conditions, such as diabetes or heart disease.
Insurers will want to participate in the exchange because government subsidies will make it easier for millions of people to buy coverage from them. But the insurers say that experience in the states shows the coverage guarantee often made it harder for people to find coverage. That's because insurers raised premiums to meet the expense of covering all applicants with chronic health conditions.
"They ended up making the problem much worse," Ignagni said of the state efforts. "The data is clear about the need to have everyone part of the system."
Analysts say Massachusetts is an example where the coverage guarantee has worked well, but it's also a state that requires everyone to buy health coverage or suffer a tax penalty.
Some key Democratic lawmakers have already expressed support for an individual mandate. The concept was a centerpiece of Sen. Hillary Rodham Clinton's health care plan. It was also part of the blueprint offered last week by Sen. Max Baucus, chairman of the Senate Finance Committee.
Obama's health plan calls for a health insurance exchange, a sort of government-run shopping center where customers could go to select from private plans or a plan administered by the federal government. Any insurer that wants to participate in that exchange must accept all customers regardless of pre-existing health conditions, such as diabetes or heart disease.
Sounds like the current way medicaid/MA is run. Won't do anything for the agents, imo
How in the world could the government tell me I HAVE to buy health insurance? That is insane.
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[COLOR=blue]The Salary Guard[/COLOR] How much would you need each month if you suddenly lost your income? Cash benefits for involuntary unemployment and accidental disability are there for you when you need them.
It is mandated right now for all in TX to buy car insurance, but not all do it.
All we have to do is look to NY on the health ins deal, they mandated that the companies take everyone, and major players just pulled out. Mass. came later: I wonder how it is working there? The "risk pool" is different in each state. I think major players start seeing they need to accept all risks, and they pull out. In all states. Once they start pulling out, we get the government stepping in. Similar to MA.
I guess I am wondering if I should start dusting off my life insurance skills. I don't want to be caught with my pants down. Well..you know what I mean!
They tried to get this through in CA last year, but it was defeated largely owing to certain "single payor" advocates in the CA legislature.
The mandate is a critical component to make it work. Without the mandate, nothing can change. Adverse selection would continue, a large chunk of the current "uninsured" market either chooses not to buy it (although they are able health and financial-wise) or chooses to use "free" or low-cost community services instead.
The carriers are smart here. GI with mandate balances (and finally creates) the proper risk pool for non-employer-sponsored health insurance. Group works because of the participation requirements (mandate) which allow the carrier to spread risk across a pool. With no mandate on individual plans, there is no way for a carrier to determine how to pool and spread risk, so we end up with an underwriting system that filters out all but the healthiest applicants.
Given that something is going to change in the next few years, the choices are only two (the current system will not stand):
1 - mandated coverage with GI available (everyone must have coverage either through work or privately)
2 - single payor coverage provided by the government
The carriers are trying to head off number 2 by creating a workable system for number 1.
Sounds like we may have universal "medical advantage" plans. (If patterned after Medicare Advantage plans)
With people so cornfused over the offering of 8 carriers and their 5 or more optional plans each, just think what a cornfuseyun this will be! 1000 insurance companies all trying to sell 5 or more options=5000+ plans to sort thru... Whew! I tremble to think of how much time we will spend certifying.... no, I don't even want to think about this. I need an aspirin.
The Bright side... looks like plenty o' work!!!
What could possibly go wrong?
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To be truly independent, an agent should not be dependent on a government bureaucrat for contracts or commissions.
Every single American who pays for health insurance { or does not} should read this and get angry. It is true, or, well, snopes says it is true. We have socialized health care, paid for by the taxpayers, right here in the USA, for people from Mexico and other countries. All you have to do is say you cannot pay. This stinks. The original author says her husband is military, serves the country, and even he does not get this kind of red carpet treatment! Wow. And, to top it all off, the hospital turns a profit!! It's not enough to soak the taxpayers... but then to turn a profit off the taxpayers while treating others from another country? Amazing story.
I work in a guaranteed issue state w/o a mandated requirement. My guess is those folks who don't want to buy health insurance will s hit themselves. They have the means, but choose not to. They will have a cow.
There is a wide variety of plans a person could choose from full meal deal to HSAs. Not alot of carriers play here and if this becomes a national policy... carriers will simply have to decide if it's a market they want to be in.
If the mandate part sticks.. it may be good for the agent after all. A new market will open up with people who want the cheapest possible premium to comply with the mandate will form. Right now, that segment doesn't exist for us.
So...looking at options 1 and 2...how will that affect us?
Option 1 means we stay in business. We can look at it as private delivery of universal mandated coverage (like auto) with likely a decrease in commissions (not necessarily but likely) as the mandate may have an attached ruling of $ utilization for the carriers (85% or better for health care services like it was written in CA). Everyone is a client, no declines, either Tier A underwritten or Tier B mandated (by state most likely) GI plans. Commission would probably reduce to around current HIPAA, say 5-7% (10-15% FYC).
Option 2 would be carriers still operating like MA plans, selling direct to the public (like NYS) and we lose out completely.
If the mandate part sticks.. it may be good for the agent after all. A new market will open up with people who want the cheapest possible premium to comply with the mandate will form. Right now, that segment doesn't exist for us.
This is the point of the article. AHIP says they will only co-operate if universal participation is mandated. Since they helped defeat universal coverage back in the 90's, the new Administration knows AHIP can make or break the deal. My bet is on mandated participation. This makes sense. The Law of Large Numbers would prevent adverse selection, thereby eliminating any excuse carriers would have not to offer universal coverage.
As I understand it, without mandated participation, adverse selection in a GI situation is ripe for adverse selection, so I agree that this would not work, ergo, mandated participation is going to be expected.
This is why state risk pools are so expensive. Eligibility is predicated on pre-ex, and qualifications (at least in my state) is that you have to have been turned down by 2 or more carriers or be quoted a rate over 200% above the state risk pool rate. The fact that we have state risk pools only shows that there is an opportunity for an uninsured to obtain insurance, not that it is affordable. It is not affordable because only pre-ex need apply. Carriers cannot be required to submit to adverse selection, so the state steps in. Don't expect them to give away the store, either.
AHIP says they will only co-operate if universal participation is mandated. Since they helped defeat universal coverage back in the 90's, the new Administration knows AHIP can make or break the deal.
A good post, most of which I agree with. But...
I don't believe AHIP has got the power to "make or break" the deal. There is energy for change now that didn't exist in '92.
It'll happen with or without them.
They are trying to save their bacon, and see that it can be profitable, even with GI/no pre-x, if they get the mandate.
As I learned it from a rep of one of the insurance carriers here in WA...
"yes, Washington is a guaranteed issue state, but we are not required to take you. You are guaranteed coverage, but you are not guaranteed coverage from us."
Crystal clear from that point on. It works Ok here. People who want insurance can get insurance. Our HR pool is more expensive, but not a great deal more. It also lacks the variety of the other side.. no HSA's, high deductibles etc..
The one thing I am interested in is all those healthy people who don't want to pay for coverage cause they're "healthy". the young 20 somethings..etc... Now instead of dropping a couple hundred a month for drinks, they may have to buck up for coverage. Rates may not go through the ceiling because not everyone who doesn't have insurance couldn't get it right now.
The one thing I am interested in is all those healthy people who don't want to pay for coverage cause they're "healthy". the young 20 somethings..etc... Now instead of dropping a couple hundred a month for drinks, they may have to buck up for coverage. Rates may not go through the ceiling because not everyone who doesn't have insurance couldn't get it right now.
After all, it was largely the young 20 somethings, (and others) that wanted change, and they voted for it. Their only misgiving is they didn't investigate the meaning and delivery of change before endorsing it. Not doting on the political aspect, but the reality of the matter.
This falls into the category of one my favorite sayings: "Be careful what you ask for, because you might get it"
Rahm Emanuel: Obama’s Healthcare ‘Long and Deep’
President Elect Barack Obama’s incoming White House chief of staff stresses that the new administration intends to “throw long and deep,” right after the kick-off in January, taking advantage of the economic crisis to push dramatic changes in health care, taxes, financial re-regulation and energy.
A good thing?? This is the United States of America! Where we are "free". the argument of auto insurance being mandated falls on its face, its only mandated, if you are going to drive. not the same at all.
To have the government mandate that people purchase something from the private sector is insane. whats next??
The government is not here to mandate healthcare, the government is not here to "decide" which private companies succeed and which fail. The public and market place should decide those things.
I tremble to think of how much time we will spend certifying.... no, I don't even want to think about this. I need an aspirin.
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