Health Care Legislation Amendment

April 22, 2010

By Padmini Arhant

As stated earlier in the blogposts – National Health Care legislation – March 29, 2010, Universal Health Care – Single Payer System under ‘Health’ category on April 8, 2010, the certainty regarding premium hikes by the Health insurance industry has prompted the legislators to introduce a bill seeking federal regulation on health rates.

According to “The New York Times”, report dated April 21, 2010

By Robert Pear – Thank you.

Democrats seek federal regulation of health rates

“Senators say they fear insurers will raise premiums.”

Washington – Fearing that health insurance premiums may shoot up in the next few years,

Senate Democrats laid a foundation Tuesday for federal regulation of rates, four weeks after President Barack Obama signed a law intended to rein in soaring health costs.

After a hearing on the issue, the chairman of the Senate health committee, Tom Harkin, D-Iowa, said he intended to move this year on legislation that would “provide an important check on unjustified premiums.”

Harkin praised a bill introduced by Sen. Dianne Feinstein, D-Calif, that would give the secretary of health and human services power to review premiums and block “any rate increase found to be unreasonable.”

Under the bill, the federal government could regulate rates in states where state officials did not have “sufficient authority and capability” to do so.

The White House offered a similar proposal in the weeks leading up to approval of the health care legislation last month.

But it was omitted from the final measure, in part for procedural reasons.

Reviving the proposal Tuesday, Harkin said:

“Rate review authority is needed to protect consumers from insurance companies’ jacking up premium simply because they can.”

Under the new health care law, starting in 2014, most Americans will be required to have insurance.

Insurers will have to offer coverage to all applicants and cannot charge higher premiums because of a person’s medical condition or history.

Michael McRaith, director of the Illinois Department of Insurance, told Congress on Tuesday,

“There is a distinct possibility that less responsible companies will raise rates to price out people who are sick or might become sick between now and 2014.”

McRaith said he and the governor of Illinois, Pat Quinn, a Democrat, “unequivocally support state based insurance regulation” because local officials understand local markets.

He endorsed Feinstein’s bill, saying it would “provide an impetus” for states to regulate premiums if they did not already do so.

Karen Ignani, president of America’s Health Insurance Plans, a trade group for insurers, said Congress should let the new law work before piling on additional requirements.

Ignagni said the law imposed new requirements, taxes and fees on health plans, which could further drive up costs.”

Amendment Requirements – By Padmini Arhant

It’s obvious from the news article and the cited blogposts that forewarned the inevitable health insurance premium hikes, especially with the mandatory insurance scheduled to commence in 2014.

Again, as indicated in the blogposts titled – ‘National Health Care legislation,’ “Universal Health Care – Single Payer System,” and per NYT article, the health care amendments are related to the most vulnerable patients subject to higher premiums between now and 2014.

The healthy subscribers may not be affected right now.

However, in the absence of foolproof system for the insurance industry to circumvent the health care laws, the majority will be forced to deal with the prolonged status quo, even after 2014.

Private sectors use the ‘unknown’ market rates for it is determined by demand and supply, to evade compliance on ‘reasonable’ price.

With the mandatory insurance purchase in 2014, the demand will exceed supply providing the insurers a huge opportunity in price management.

Sen. Dianne Feinstein’s bill is to address that aspect of the problem.

If the bill is aimed at premium caps augmented with the health and human services discretionary power to block the ‘unreasonable’ rates – it is thoughtful but not guaranteed to be obliged by the Health Insurance industry.

Further, any federal assurance to regulate rates upon the states’ failure or inability to do so, is also a welcome change.

Nevertheless, the resistance from the President of America’s Health Insurance Plans, Karen Ignani, representing a trade group of insurers to any new requirements is conspicuous.

Notwithstanding, the assertion to transfer the costs burden to the consumer, the ultimate payee in the retail business.

It’s always possible to modify and manage products and services under self-control, but it’s much harder when it’s designed and delivered by others.

Regardless of the requirements and legislations, the industry that is a dominant force in the health care service would not easily compromise on the disproportionate profit margins attained thus far.

That’s why, the solid protection for the ‘unaffordable’ customers and those in need of ‘urgent’ care, the existing Medicare expansion is recommended.

As such, the patients under these categories are being assisted with the federal funding to enable access to the ‘private for profit’ health care.

Therefore, it eliminates the opposition to the ‘Universal Health Care’ funding.

In fact, when the cost/benefit ratio is evaluated, the Single Payer system is approved by the economists, Congressional Budget Office and the non-partisan groups concerned about the consumer rights and the rising national deficit.

The purpose behind the health care legislation was to rein in costs to the ‘average’ American families struggling to cope with the private industry’s vertical premiums that will persist despite the regulations as confirmed by the President of the America’s Health Insurance Plans, Karen Ignani.

Although, the coverage denial on pre-existing conditions exacerbated with the higher premiums is prohibited, the present and the future subscribers i.e. in 2014, have not been informed with the relevant details, particularly on the quality and the maximum medical expenses for their individual health condition.

There is lot of ambivalence that requires clarification.

The information on the health care law made available to the public with Q&A interface is necessary to dispel the myths around the insurance plans and the unmitigated health care expenses.

Public awareness and complete knowledge of the health care law is essential to prepare the customers financially in the exclusive private health care service.

In addition, per the insurance industry stance against the health care law and any requirements, the consumers are challenged with the uphill battle in terms of unlimited health care access and affordable costs.

Unless the ‘Universal Medicare’ is extended to the vast uninsured, the health insurance and the health care industry would continue to maneuver around the health care legislation.

The health care legislation is a preliminary step towards the specific issues like pre-existing conditions.

Since, the actual benefits to the currently insured and uninsured are still dependent upon the ‘private for profit’ health care policy,

Unequivocally, the Universal Medicare for all with 24/7 access, especially to the ‘federal aid’ recipients is the immediate and permanent solution to the emerging and the long-term health care crisis.

Thank you.

Padmini Arhant


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