Health Insurance Lobby Reiterates Its Support for Tougher Laws Requiring People to Buy Health Insurance

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As I noted at the time, despite the outrage (and threats) it provoked from Democrats, that notorious health-insurance lobby report suggesting that health-insurance premiums would go up after the passage of health-care reformwas not actually intended to kill reform. Instead, the intent was to push Congress to make the individual mandate — the requirement that everyone buy the insurer's product — stronger. Here's Karen Ignagni, the head honcho at AHIP, the health-insurance group that put out the report, making the health-insurance industry's case:

Health plans continue to strongly support reform. In fact, last year we proposed new insurance market rules and consumer protections to achieve universal coverage, remove restrictions on preexisting conditions and end the practice of basing premiums on health status or gender.

Some have questioned the timing of the report's release. AHIP commissioned the report Sept. 29, as it became clear that the Finance Committee would gut the requirement that all individuals obtain coverage.

I have no issue with people who take issue with the methodology of the report; it looked rather fishy to me. But the idea that AHIP was trying to take down the reform bill is just absurd.

And while we're on the topic of Ignagni's op-ed, it's worth addressing another section. She writes:

The report's central finding has long been noncontroversial in health policy and economic circles: namely, that implementing reforms of the insurance market without a strong requirement that everyone participate will cause adverse selection and significantly increase costs for individuals and small businesses.

Well, it's certainly true that insurance market reforms like guaranteed issue and community rating have a long history of driving up insurance premiums. And it's also true that the insurance industry has for years pushed the idea that those reforms are only workable with a strong mandate. But, as I've pointed out before, the mandate isn't necessarily a cure-all. Massachusetts, the one state with a mandate, has the highest health-insurance premiums in the nation, and even supporters are worried that public health-care costs are rising so quickly that they may threaten the continued existence of the state's universal-insurance system.

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  1. Wow, once again the Sheeple get the short end of the stick, is anyone surprised??

    RT
    http://www.anonymous.ua.tc

  2. What do you do when Godzilla and Megalon, instead of killing each other, get together and come after you?

    1. I don’t need to be faster than them. I just need to be faster than you.

  3. But the idea that AHIP was trying to take down the reform bill is just absurd.

    Caveat: I could believe that taking the bill down would be a no. 2 choice compared to the public option or perhaps the bill with no mandate.

  4. remove restrictions on preexisting conditions and end the practice of basing premiums on health status or gender.

    In order to do this, and a few other things, won’t the states have to give up there bailliwick of regulating insurance.

    Seems to me that someone needs to settle who regulates insurance before any of this other stuf gets done.

    And before anyone starts, the fact that I would be just as happy to see no one except the free market regulate insurance, I’m resigned to the fact that I have no say.

    Most of this talk just leads me to one conclusion; for all this talk, no one has a plan (not even a bad one).

    They’re just dicking around til the whole thing becomes a total clusterfuck that they can bitch about in the next campaign cycle.

    1. Yeah it’s a clusterfuck and they know nothing will get done and that’s what they want, so they can blame someone else and say “I tried.” No change is better than destructive change. If there is guaranteed issue and community rating then there is no reason not to wait until you’re already sick to buy insurance. What a clusterfuck that will be!

  5. They’re just dicking around til the whole thing becomes a total clusterfuck that they can bitch about in the next campaign cycle.

    Well stated. That can be applied to a myriad of other issues too.

  6. What it comes down to is I will soon be taxed for living.

    If I don’t buy drivers insurance and get caught, I pay a penalty or lose my license…if O don’t buy health insurance and get caught, I pay a penalty or lose my life?

    Everyone’s worried about 1984, I’m worried about Brazil!!!

  7. There was a news clip last week that suggested something about Rangel inserting language into the house bill to allow the two bills to go through “reconciliation” which would some how avoid the need for 60 votes in the senate. Anyone know what that’s about?

    1. Here’s the trick: They gut a bill that has already “passed” in the house. Say one about loving and supporting adorable, cute puppies.

      They replace the insides of the puppy bill with the new health care bill and viola! the bill is considered to have already passed in the House. Then its able to be sent to reconcillation with the Senate bill.

  8. Oh god. I just had a horrifying thought. MA incorporates the health insurance mandate onto their state income tax returns. It would suck balls if the fed requirement did the same.

    1. It does. The mandate’s fines will be administered by the IRS.

      1. Yes, and if anyone is thinking about not paying those fines….well interest and penalty, penalty and interest, etc.,etc., until it becomes profitable to come get your home or anything else of value you might possess. Think you can maybe just not file a return? Wait until you try to collect your Social Security someday. The government runs everything and you will play their way or you will essentially be made a non-person as far as government is concerned.

        1. What is going to happen is not that they will increase the tax – according to NPR, the mandate was gutted to only have a $200 fine increasing to $750 per year.

          What is going to happen is that insurance premiums will skyrocket, and people will increasingly drop out of the private insurance market, to the point that Congress will use it as an excuse to push through a government program, funded by the fines. Your annual fine will now be your “premium” in the “public option”. The fines will then be rescaled to make them progressive.

    2. You mean they audit compliance through taxes or use refunds to fund the program?

      1. Never mind.

      2. Never mind.

    3. It would suck balls if the fed requirement did the same.

      Where have you been? That’s exactly what it does. You will pay a penalty on your federal tax return, if you do not have an “approved” health insurance policy. That’s why it is actually a tax, regardless of what Obama says.

      1. The only way to beat the government is to man-up and die. Fuck ’em.

  9. The best way to keep automobile costs down would be to require everyone over 18 to purchase one every three years.

    Sounds kinda stupid, doesn’t it?

    1. Awesome analogy.

    2. Have you thought about a job with the Obama administration?

      You’re a natural.

      1. His plan would be very simulating. Especially if we crush-cube the cars after the new ones are bought.

        1. Just think, we already have the “public option” of auto makers, General Motors.

        2. All part of the plan.

    3. Goddamnit JsubD, don’t give them ideas!

    4. Ahh, but they have to, because they are forcing the car companies to give free cars to the homeless. Someone has to keep them from losing money.

  10. Insurance companies stand to make out like bandits is a universal mandate passes. Insurance companies usually only break even on premiums. They make their profit on investments they make using the money in the premium pool. The bigger the premium pool the bigger the profit.

    A universal mandate such as that outlined by the President will (1) Require every American to contribute to the investment pool of insurance companies and (2) will underwrite the losses the companies incur from insuring people with preexisting conditions (which will also enlarge their investment.)

    They can’t lose money unless someone tries something stupid like requiring insuring all preexisting conditions without recompense. That is never going to happen because it is obvious that will bankrupt insurance companies in a few years.

    The insurance companies only concern is that the government will let some people slip by without contributing to their investment pool. Otherwise, they stand to rake it in big time from the people who claim to hate them the most.

    1. Except for this wrinkle: what if I decide (or my employer decides) that paying the no-insurance tax instead of buying coverage makes more sense? And if lots of other healthy people come to the same conclusion?

      1. They’ll simply increase the tax until everyone joins. They’ll likely increase it anyway, but that will just make for a nicer, quicker method.

        1. Methinks the tax increases won’t be able to keep up with the increases in premiums.

        2. No, they will wait until the insurance companies start going bankrupt, or premiums skyrocket to unsustainable levels, and then have another “crisis” and turn the fine into a fee for a national health plan.

      2. And if your no-insurance tax becomes revenue the government uses to expand coverage of those not-insured, albeit with less benefits, aren’t you already paying the insurance companies (in the form of the government)

      3. When you get sick, you will then have the legal right to require an insurance company to pay for all your treatments even if you never paid them a dime before. The insurance company will then get paid from the government.

        Besides, that is only one version of the plan. Most version require everyone to either buy private insurance or to go on a government plan. I imagine the insurance companies are betting that anyone who isn’t poor will go private.

    2. They can’t lose money unless someone tries something stupid like requiring insuring all preexisting conditions without recompense. That is never going to happen because it is obvious that will bankrupt insurance companies in a few years.

      That’s a feature, not a bug. The people who want a single-payer public “option” would be more than happy to bankrupt the private sector insurers.

    3. They can’t lose money unless someone tries something stupid like requiring insuring all preexisting conditions without recompense.

      Er, I believe that is exactly what is in the bill.

  11. Have you thought about a job with the Obama administration?

    You’re a natural.

    1. the Obama administration is working on legislation to require threaded comments be posted correctly.

      Naturally, I will treat that legislation like i treat the tax laws.

  12. That’s how you end up with health care bills being named “The Lovable Puppy Resolution.”

    It was used with either one of the bailouts or TARP (I forget). The tipoff was that the bill was originally entitled something like the Mental Health Funding Act, or some such.

  13. It should come as NO SUPRISE that the health insurance industry would love the mandate of making insurance manditory for everyone.

    1. I suppose the only surprise is that it’s the ostensibly left-wing faction that’s requiring people to essentially start paying taxes to private businesses, so long as those businesses play along.

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