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Thousands of activists – many from CWA and other unions – marched yesterday in Washington to demand health care reform and to confront insurance company executives.
The insurance bigwigs were meeting at a plush Ritz-Carlton hotel. Outside, the protestors chanted slogans such as, "Blocking health care is a crime" and "Health care can’t wait," according to the AFL-CIO's blog.
"The insurance companies won’t stop unless we stop them—and we do that by passing health care reform legislation," AFL-CIO President Rich Trumka told the rally. "So today we’re here to put the insurance companies on notice: We will not allow you and your lobbyists to bully Congress into not acting. Not on health care or any of the issues important to America’s working families."
Gerald McEntee, president of the American Federation of State, County, and Municipal Employees, said the rally was "to expose the high crimes and misdemeanors perpetuated by the insurance industry time after time and year after year," the Wall Street Journal reported.
The rally was sponsored by Health Care for America Now!, a coalition of which CWA is a member.
The insurance companies don't have to march in the streets. They speak through their lobbyists. Industry – insurers and their allies, such as the Chamber of Commerce – spent more than a billion dollars last year to influence or block health legislation. They hired an army of 4,525 lobbyists, or eight for each member of Congress, according to a recent analysis by the Center for Public Integrity.
– 03/10/10
Health insurance is primarily regulated by states, which set the rules for what policies must cover, how they are priced and who can buy them. So, you can only buy New York policies in New York and Wyoming policies in Wyoming.
Republicans are proposing to allow policies to be sold across state lines – a New Yorker could buy a Wyoming policy. Since insurance is cheaper in some states than others, this could save consumers money, they argue.
There are two problems with this:
First, it would weaken consumer protections. One reason insurance is more expensive in some states is that those states have adopted more rules to protect consumers. Policies have to cover certain services, and consumers can appeal if they disagree when an insurer refuses to cover an operation or treatment. By allowing sales across state lines, insurance companies could simply set up shop in states with the least regulation, avoiding state rules to protect consumers. This has already happened with credit card companies, as Washington Post blogger Ezra Klein recently pointed out:
This is exactly what happened in the credit card industry, which is regulated in accordance with conservative wishes. In 1980, Bill Janklow, the governor of South Dakota, made a deal with Citibank: If Citibank would move its credit card business to South Dakota, the governor would literally let Citibank write South Dakota's credit card regulations.
Citibank wrote an absurdly pro-credit card law, the legislature passed it, and soon all the credit card companies were heading to South Dakota. And that's exactly what would happen with health-care insurance. The industry would put its money into buying the legislature of a small, conservative, economically depressed state. The deal would be simple: Let us write the regulations and we'll bring thousands of jobs and lots of tax dollars to you. Someone will take it.
Second, it wouldn't save much money. Much of the variation in costs between states isn't a result of regulation – it's a result of the treatment options available; for example, Massachusetts has lots of sophisticated hospitals and specialists. If care costs more in Massachusetts, insurers aren't going to sell Massachusetts residents coverage at Mississippi prices.
I happen to live in a state – Maryland – with lots of regulations on health insurance. It requires the insurance companies cover mammograms; some states don't. Among other services it requires, which some neighboring states don't, are: in vitro fertilization; treatment for mental illness, morbid obesity and smoking cessation. If your insurance company says it won't pay for a treatment, you can appeal to the Insurance Commissioner, who gets neutral medical specialists to review whether you need the recommended care.
If insurance were sold across state lines, all of these protections would go away. I wouldn't have the choice of a Maryland policy or a cheaper policy from a state with light regulations – all policies would be offered from states with light regulations.
But these protections don't add a lot to the cost of buying health insurance. An actuarial study for the Maryland Health Care Commission estimates that policies in Maryland cost about 1 percent more than insurance in neighboring states with fewer rights for patients. What drives costs are not consumer protections but differences in prices and treatment options.
– 03/08/10
The five top U.S. health insurance companies rolled up a record $12.2 billion in profits in 2009 – up 56% from 2008, according to a recent report from Health Care for America Now!, a reform coalition of which CWA is a member.
"The outsize earnings are a vivid reminder that without comprehensive national health care reform the gatekeepers of our broken health insurance system always will put the short-term interests of Wall Street before the needs of millions of patients and a national economy plagued by joblessness," the report concludes.
One of those insurers, WellPoint, has recently come under fire for premium hikes of up to 39%. The other four largest insurers are UnitedHealth, Aetna, Humana and Cigna. All but Aetna showed sharply higher profits in 2009. HCAN compiled the earnings data from insurance company filings with the federal Securities and Exchange Commission.
At the same time the insurers were fattening their balance sheets, millions of Americans lost coverage, the report says. The top five insurance companies reported 2.7 million less Americans covered by private coverage, although the number they covered through government programs, such as Medicare and Medicaid, rose by 688,000.
In part, the report explains, fewer Americans were covered because so many lost their insurance when they lost jobs. "But many others – exact tallies are trade secrets – were victims of an industry practice called purging," the report continues, "in which sharply higher premiums push individuals with health problems or employers with sicker or older workforces away from coverage."
– 02/16/10
We've been understandably focused on the details of health reform legislation: Will our benefits get taxed? Will there be a public option? What will premiums be? Who will be eligible for coverage? Of course, we need to think about these questions — it's important to get health reform right. But it's also worth remembering why we need health reform in the first place.
WellPoint, the country's largest health insurer, is socking individual members in California with premium increases of 30% to 39%, the Los Angeles Times reported. And as if that annual rate hike is not enough, the insurer (doing business in California as Anthem Blue Cross), says it plans to bump premiums up more often than once a year.
WellPoint said it needed the premium increase to cover rising medical costs. But the company itself says that its medical costs increased 8.9% last year — a large amount, to be sure, but hardly 39%. Clearly, the premium increases leave a generous margin for profit and for executive pay.
In the same announcement in which it said costs were going up 8.9%, WellPoint told Wall Street that it rang up $4.7 billion in profit in 2009, including $2.7 billion in the fourth quarter alone — nearly double the profit from the previous year's fourth quarter. Its CEO pockets nearly $10 million a year in pay, benefits and stock options.
"The Company continues to price its business so that expected premium yield exceeds total cost trend, where total cost trend includes medical costs and selling, general and administrative ("SG&A") expense," WellPoint said in the announcement. Translation: We're going to keep raising premiums more than medical costs plus administrative expense — which, by the way, is 17% of the premium dollar — so profits will continue to go up.
Also contributing to the size of the increases is the way insurance group customers to set rates, as explained by The New Republic's health blogger, Jonathan Cohn. Insurers companies create risk pools by grouping people by geography and/or by demographic factors such as age and gender. As the members in one particular pool age, they get more care, and premiums for that group go up faster. That causes young and healthy members to drop coverage, which adds to the number of uninsured and pushes premiums up even faster for those who remain.
WellPoint's hefty increases have caught the attention of Congress and of Kathleen Sebelius, the Secretary of Health and Human Services. But while federal officials can pressure WellPoint, they're limited in what they can do to head off rate-gouging.
Unless health reform becomes law.
How could health reform help? Although they differ in details, bills passed by the House and Senate would:
- Make for fairer risk pooling by combining large numbers of people into insurance exchanges (a national exchange in the House bill, state exchanges in the Senate bill). The bills would prohibit insurers from charging more for women (now a routine practice) and limit the amount that insurers can charge older enrollees relative to younger members.
- Establish minimum percentages of premium that insurers have to spend on care (85% in the House bill, 85% for large employers and 80% for small employers and individuals in the Senate bill). WellPoint is currently at 84.8% -- meaning under the House bill, it would have to cut premiums by a little, not raise them 39%.
- Set up a process to review the justification for premium increases before they could go into effect.
- Also, the House bill would create a public health insurance plan that people could choose if private insurers raised rates too much. The resulting competition should keep private premiums lower.
– 02/10/10
We've been understandably focused on the details of health reform legislation: Will our benefits get taxed? Will there be a public option? What will premiums be? Who will be eligible for coverage? Of course, we need to think about these questions - it's important to get health reform right. But it's also worth remembering why we need health reform in the first place.
Rashidam Shakirova waited for an insurance company to approve her enrollment - and while she was waiting, delayed treatment for a lump she felt in her breast. Finally, after several months she hired a lawyer, and the insurer began coverage. By then, however, the cancer has spread, and although she received treatment, doctors think she has less than five years to live, the New York Times reported.
"If I had gotten it when I was supposed to, I would have gone back to work and felt fine and my life would not have been broken," she told the Times. "I'm paying taxes. I'm not here for charity. I want to work; I want to contribute and be functional in society."
For other people, the problem isn't getting coverage from an insurance company. The problem is keeping the coverage they have.
Jennifer Latham, a Colorado preschool teacher, suffered a brain injury and multiple fractures when her car was slammed by a suspect fleeing police. She spent a month in the hospital and a month in a rehab center. But soon after she got home, she received a letter from her insurance company, saying they had cancelled her claim and wouldn't pay her $185,000 in medical bills, according to an article in the Boulder Daily Camera.
The insurer said it was justified in cancelling because when she applied for the insurance, she hadn't told the company about a previous emergency room treatment for shortness of breath.
Coverage denied, coverage delayed, coverage withdrawn - all part of our broken system.
How could health reform help? Although they differ in details, bills passed by the House and Senate would:
- Prohibit insurance companies from denying coverage based on pre-existing medical conditions.
- Prohibit insurance companies from cancelling policies when people get sick.
- In addition, the Senate bill would penalize employers who require a waiting period for coverage of more than 60 days - a provision that would have gotten Rashidam Shakirova coverage about the time she first felt the lump in her breast.
Getting rid of denying coverage for pre-existing conditions is popular; Republicans as well as Democrats say they support it. Some have suggested, given the political complexity of passing comprehensive reform legislation, just passing a law requiring insurance companies to sell policies to anyone who wants one. But passing small, popular pieces of reform without a comprehensive package creates more problems.
In this case, simply preventing insurers from denying coverage would mean that people could go uninsured until they get sick, then quickly buy a policy. Like selling homeowners insurance to people whose houses are already on fire, that would drive up premiums for everyone. So the comprehensive reform bills say everyone has to buy health insurance.
What about people who can't afford the full cost of coverage? To make it possible for everyone to buy coverage, the comprehensive bills set up a system of sliding-scale subsidies for moderate-income people.
– 02/08/10
Health insurers quietly funneled millions of dollars to the Chamber of Commerce to pay for ads attacking health reform, National Journal reported recently.
The insurance industry's trade association and lobbying arm, America's Health Insurance Plans (AHIP) hit up the largest for-profit insurers to chip in to the Chamber's efforts to help sink reform, according to the report. And the big insurance companies - Aetna, Cigna, Humana, UnitedHealth and WellPoint - each ponied up a seven-figure contribution.
At the same time it was collecting millions to block reform legislation, AHIP was saying publicly that it supported reform. AHIP disguised its own role in funding the ads, passing the money through the Chamber of Commerce, to avoid backlash, one lobbying source told National Journal.
Apart from the millions they've been quietly slipping to the Chamber of Commerce, the insurers have also been lavishing big bucks on lobbying - including $4.7 million last year by WellPoint and $4.5 million by United Health, according to The Hill.
All this serves as a reminder of who benefits from the status quo - and it isn't ordinary consumers and patients.
– 01/26/10
We've been understandably focused on the details of health reform legislation: Will our benefits get taxed? Will there be a public option? What will premiums be? Who will be eligible for coverage? Of course, we need to think about these questions - it's important to get health reform right. But it's also worth remembering why we need health reform in the first place.
Women pay much more than men the same age for individual insurance policies, the New York Times reported recently.
"The wide variation in premiums could not possibly be justified by actuarial principles," Marcia D. Greenberger, co-president of the National Women's Law Center, told the Times. "We should not tolerate women having to pay more for health insurance, just as we do not tolerate the practice of using race as a factor in setting rates."
"In America today, a 25-year-old woman is charged up to 45 percent more than a 25-year-old man. Once she reaches 40, it can be up to 140 percent more," Sen. Barbara Mikulski, a Maryland Democrat, said at a recent Senate hearing on the issue. "Three-in-five women today have problems paying their medical bills. And 52 percent of women say cost is a barrier to getting health care. Seventeen million women in America are uninsured today."
At that hearing, one witness, Peggy Robertson, of Colorado, testified: "We applied with Golden Rule and I was denied coverage based on having a cesarean with Luke in 2006. I am in perfect health....I called Golden Rule and they said that if I would get sterilized, they would then be able to offer insurance to me....After filing a complaint, I discovered that Golden Rule is allowed to discriminate against women who have had a c-section."
Some of the issues with access and cost are described in a video prepared by the Women's Law Center.
Health reform could prevent insurers from discriminating by gender. That prohibition is written into the reform legislation passed by the Senate Health, Education, Labor and Pensions (HELP) Committee, and Mikulski has pledged to work to make sure it's in the final bill that comes out of Congress.
– 11/13/09
There are a lot of myths about health reform, Vice President Joe Biden says in a new video, but, "the greatest myth of all is that our health insurance system is just fine, that there's no serious need for reform."
So, Biden is asking us to go to the White House's "reality check" Web site, where you can learn more about myths about health reform.
And, he says, it's important not just for the White House to bust the myths, but for the American people to bust the myths. So he's asking us to upload our own videos, to "tell the defenders of the status quo why health insurance reform is important to you as an American."
Some of the videos will be posted on the site.
– 09/08/09
The country's health system may not work well for everyone, but it generally works for the insurance companies. And that's why we can expect insurers to work to water down health reform.
From the New York Times comes the story of Lawrence Yurdin, a 64-year-old computer security specialist from Texas, who thought his Aetna insurance policy would pay for up to $150,000 in hospital care. The fine print in his policy, however, limited his coverage for "other hospital expenses." And "other hospital expenses" turned out to mean most treatments and medications. (Aetna did pay for his hospital room.)
Faced with $200,000 in unpaid bills, Yurdin filed for bankruptcy. As we reported recently, a new study shows medical costs are a factor in up to three-quarters of bankruptcies - and three-quarters of those medical bankruptcies are filed by people who have insurance. As health economist Len Nichols told the New York Times, "insurance means normal people should not go bankrupt from serious medical conditions."
Health reform would make sure that all insurance policies offer real benefits - and don't cancel them with small print, as they did to Lawrence Yurdin.
Yet as reform bills are written and debated, insurance companies "will fight to keep flexibility to design benefits as they see fit; in other words, low-cost policies that don't cover very much," Wendell Potter, a former insurance executive, told Columbia Journalism Review.
Insurers also want to base rates on age, as "a way to keep charging the most to the people who are likely to be the sickest." And they want "more products that will shift the financial burden to consumers," "plans that cover less and more move further away from the concept of insurance."
Potter was head of corporate communications at CIGNA, but left last year because, as he told the magazine, "I didn't want to be part of another health insurance industry effort to shape reform that would benefit the industry at the expense of the public."
The former insurance company insider, said, "They talk about how much they are committed to reform. But, behind the scenes, they are financing efforts to kill elements they are opposed to, or they kill reform entirely."
That's why those of us who want to see real reform need to speak up, and need to hold our elected officials accountable for passing reforms that are designed to protect us, not protect the insurance companies.
– 07/10/09
Insurance companies, drug manufacturers and others with vested interests are gearing up big time to lobby on health reform until the plan is to their liking.
That makes real change more difficult. "It's extremely hard, because every time a legislator genuinely wants to craft a new policy, they have to contend with very powerful interest groups who threaten, who cajole," Julian Zelizer, a professor of history and politics at Princeton University, told NPR.
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Source: NPR |
Over the last ten years, the number of registered lobbyists on health has doubled to 3,627, NPR reported.
Not only is the number of lobbyists huge and growing, but many of them have inside connections. The Washington Post reported that insurers, hospitals and other industry groups have hired 350 retired members of Congress and former government staff members "in hopes of influencing their old bosses and colleagues."
And if that's not enough influence, the health industry lobbyists are spending $1.4 million a day in their efforts, according to the Post. The trade association for the drug-makers, the Pharmaceutical Research and Manufacturers of America, alone has spent $7 million in the first quarter of 2009. Several drug companies, the American Medical Association and the American Hospital Association each spent at least $3.5 million in the quarter.
The insurance companies and the drug manufacturers will get their message to Congress. We need to make sure we get our message to Congress as well.
– 07/08/09
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