CQ TODAY ONLINE NEWS
July 16, 2009 – 12:39 a.m.
Insurers: Don’t Make Us Pay
By Alex Wayne and Drew Armstrong, CQ Staff
Key senators say they want to force the health insurance industry to pay as much as $100 billion toward the 10-year cost of the health care overhaul sought by President Obama.
Insurers have already agreed to stand by as Congress forces them to abandon business practices that have angered many Americans and lawmakers, such as refusing to offer coverage to people with pre-existing conditions.
But the industry said Wednesday that it would draw the line at contributing to the cost of an overhaul, setting the stage for a debate that could end with insurers fighting the effort.
The Health, Education, Labor and Pensions Committee voted along party lines, 13-10, on Wednesday to approve its draft health care bill.
The Finance Committee is drafting its own version, which will include ways to pay for the plan’s estimated $1 trillion, 10-year cost. Democrats said they discussed on Wednesday levying a tax on insurers’ premiums as one means of raising revenue.
Sen. Charles E. Schumer , D-N.Y., said Democrats hope to raise $75 billion to $100 billion from such a tax, though it was unclear how it would be structured.
A Republican on the committee, Olympia J. Snowe of Maine, said she would also support such a tax.
Schumer and others said they did not know how they would prevent insurers from simply passing the tax on to their customers in the form of higher premiums.
But the point, they said, is to make the industry contribute financially toward an overhaul that is expected to result in insurers gaining millions of new customers. Congress is discussing ways to extend coverage to most of the estimated 46 million uninsured Americans, both through increased private coverage and through new and expanded government programs.
“We need the insurance industry to step up to the plate and be part of the solution,” Schumer said at a news conference. “It makes sense that private insurance companies, who are going to gain 40 million new customers as part of health reform, should pay their fair share.”
Another Finance member, John D. Rockefeller IV , D-W.Va. — a frequent critic of insurers — said the companies are “rapaciously, greedily and unstoppably making money, by underpaying the patient, underpaying the provider and overpaying themselves.”
Finance members including Debbie Stabenow , D-Mich., and Robert Menendez , D-N.J., said the industry has more than enough money to spare for the effort. Democrats cited statistics showing that the profits of the top 10 health insurers rose from $2.4 billion in 2000 to $12.9 billion in 2007, a rate of growth that Schumer said “is enough to make Big Oil company executives blush.”
Democrats also noted that other health industries have agreed to contribute toward the cost of the bill. Hospital trade associations said last week that their members would agree to government payment cuts totaling $155 billion over the next decade, and drug companies agreed last month to dedicate $80 billion toward both the overhaul and reducing drug costs for seniors in Medicare.
Insurers Say They’ve Done Their Part
Robert Zirkelbach, a spokesman for America’s Health Insurance Plans, which represents the industry, said his association’s members have already made significant contributions to an overhaul. In exchange for a mandate that all Americans obtain coverage, insurers have agreed to two key policy changes that would prevent them from refusing to cover people who are sick or charging the sick higher premiums than others in their communities.
“We have outlined specific and far-reaching initiatives to help bend the health-care cost curve by simplifying policies and procedures so that physicians and hospitals can focus on patient care,” he said in a statement. “If implemented broadly, these reforms are game changers and will have a similar impact that ATMs had on banking.”
He suggested that insurers would seek to pass on any new tax to their customers. “As families and small businesses struggle during the current economic slowdown, now is not the time to impose new fees on health care coverage that will make coverage less affordable,” he said.
Pressure For Progress
Costs are a key issue for the Finance Committee, which lags the HELP Committee in advancing overhaul legislation in part because it must come up with ways to pay for the measure.
The Finance Committee is under pressure from Senate Democratic leaders and President Obama to complete a bill quickly. Obama wants the measure passed by the Senate by August. But Finance members pushed back on Wednesday.
“It is much more important that we get this right than we adhere to some arbitrary deadline,” said Kent Conrad , D-N.D.
Snowe said she and other Finance members of what Chairman Max Baucus , D‑Mont., calls a “coalition of the willing” were making progress but needed more time. “I don’t know what’s magic about the timeline,” she said.
The bill that already made it out of committee is expected to be combined with Finance’s bill on the floor this summer.
Already, it’s been a long process. Working through amendments prior to Wednesday’s vote took 13 days. Acting Chairman Christopher J. Dodd , D-Conn., said nearly 500 amendments were considered and about 160 amendments from Republicans were adopted.
Those amendments will be key to the majority party’s ability to call the measure a bipartisan bill, even though every Republican on the committee ended up voting against it.
What’s In The Committee-Passed Bill
The draft legislation would require individuals to obtain health insurance and require employers to help cover the costs for their workers. It would create a new, government-run insurance plan to compete with private plans in new government-run marketplaces called “exchanges,” where individuals could choose among plans.
It also would make major changes to how health care is delivered, including by emphasizing preventive care and wellness.
Between that bill and a Medicaid expansion expected in the Finance measure, the Democrats’ package would cover most of the nation’s uninsured, according to estimates by the Congressional Budget Office.
Republicans said the effort so far has been too partisan and would lack credibility with the public.
“I did have high hopes that this would be the year that Republicans and Democrats could work together,” said ranking Republican Michael B. Enzi of Wyoming. “If America’s going to believe in what we do, it has to be a bill put together by both sides.”
Comments
Over 100 repub amendments included but it's not bipartisan? Dems, take all those amendments out since they're clearing not going to vote for the bill. We must have a public option and we must have a national exchange with set premiums. No more punishing of the almost old. Age rating is wrong. 24 yr old male pays 180 per month, 60 year old pays$1,000 per month. Sound fair to you? Insurance companies don't want to contribute because they don't want to give up one dime they squeeze from us. They cheat providers as much as they do the insured.
andreams, your ignorance is appauling. You are a fine example of the US public education system. I suggest you stop reading the NYTimes to get your information and read a few medical journals and read the governmental regulations slapped on the medical health insurance industry. I also suggest you actually take a few hrs to read the bill the house and senate are offering.
Damian, What have you brought to the table other than name calling? Have you read the bill? If federal regulations are causing the problem then what are they? If they are unnecessary let's get rid of them. GOP would score points with me if they would propose amendments to do what you suggest. And yet you haven't named one
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