Federal Healthcare Update

October 12, 2009

Pardon Our Dust

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By Mona Mohib
The health care debate is picking up this week, with a vote on health care reform expected in the Senate Finance Committee tomorrow. Over the weekend, the America‘s Health Insurance Plans  (AHIP) released a report with a detailed analysis of the Finance Committee’s bill, which claimed that the health care reform bill would drive up health care premiums, increasing health care costs for Americans. This is in contrast to the Congressional Budget Office (CBO) score of last week, which predicted that the bill would make coverage more affordable. Karen Ignagni, president of AHIP, summed up the report by saying “The overall impact will be to increase the cost of private insurance coverage for individuals, families and businesses above what these costs would be in the absence of reform.”
The AHIP report states that between 2010 and 2019 the cumulative increases in the cost of a typical family policy under this reform proposal will be approximately $20,700 more than it would be under the current system. The higher costs would be necessary due to a ‘weak’ individual mandate combined with a new requirement that insurance companies insure all applicants. According to the report, this would create a “powerful incentive for people to wait until they are sick to purchase health insurance.”  These higher costs to the insurance company would be passed on to consumers in the form of higher premiums.
A spokesperson for Democrats on the Finance Committee released a statement contradicting the AHIP release in ten points, and said, “This report is untrue, disingenuous and bought and paid for by the same health insurance companies that have been gouging consumers for too long. Now that health care reform grows ever closer, these health insurers are breaking out the same tired playbook of deception. It’s a health insurance company hatchet job.”
Initial reactions show that White House officials are also pushing back on this interpretation of the bill. Linda Douglass, Director of Communications at the Office of Health Reform, said today that the AHIP report ignored important aspects of the bill, including “critical policies that will lower costs for those who have insurance, expand coverage and provide affordable health insurance options to millions of Americans who are priced out of today’s health insurance market or are locked out by unfair insurance company practices.”