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“Blaming Obamacare Is A Smokescreen”: Sorting Out The Real Reasons Why Insurers Cancel Health Insurance Policies

Now that President Obama has said it’s OK with him if insurance companies keep their policyholders in health plans that don’t meet the standards established by the Affordable Care Act, at least for another year, the big question is whether insurers will take him up on the offer.

The answer: it depends.

Some insurance executives will view the offer as one they can’t turn down. Even though Karen Ignagni, president of America’s Health Insurance Plans, the industry’s big PR and lobbying group, had nothing good to say about Obama’s proposal, keep in mind that she doesn’t run an insurance company.  While industry executives look to her to comment on what politicians do, they make their own decisions when it comes to their companies’ bottom lines.

Here’s what Ignagni was quoted as saying in a FOX News story Friday:

“The only reason consumers are getting notices about their current coverage changing is because the ACA (Affordable Care Act) requires all polices to cover a broad range of benefits that go beyond what many people choose to purchase today.”

Not so fast. There are other reasons some folks are being told they’ll have to change health plans next year. Many of them are having to switch plans not because of Obamacare but because their insurance companies want to move them into policies with higher profit margins.

Insurance companies have been sending similar notices to their customers for years. My son Alex — and thousands of other customers of a Blue Cross plan in Pennsylvania — got such a notice four years ago, months before Congress passed the health reform law.

Why? The insurer wanted to move those policyholders out of a plan with a reasonable $500 annual deductible and into one with a deductible ten times that amount. To accomplish that, Blue Cross notified its policyholders that their health plan would not be available in 2010. Their options were to switch to the high-deductible policy, which would still cost them a couple of dollars more each month, or to another plan with that reasonable $500 deductible. If they chose the latter, their monthly premiums would increase 65 percent.

Notices like the one Alex got have provided a mechanism for insurers to implement a years-long industry strategy of shifting more and more of the cost of medical care to their policyholders. And that strategy will continue until every last one of us is in a high-deductible plan.

Some of you are likely old enough to remember the days before managed care when almost all Americans with private health insurance were in indemnity plans. In an old-fashioned indemnity plan, the insurer didn’t constrain us in a limited network of doctors and hospitals and didn’t call the shots about whether a knee replacement or liver transplant your doctor recommended was really necessary.

Those days are long gone. Everybody eventually got notices that those plans were being discontinued. They were replaced by HMOs and PPOs with limited provider networks and armies of utilization review nurses and medical directors who decided if you would get coverage for your new knee or new liver.

In most cases, it was our employers who killed off the indemnity plans in favor of managed care. But eventually, HMOs and PPOs also fell out of favor. The managed care backlash of the late 1990s forced insurers to abandon some of their utilization review practices and to add more doctors and hospitals to their skinny networks. That led to shrinking profit margins — and to the latest silver bullet from the insurance industry: high-deductible plans.

Before Obama signed the Affordable Care Act, insurance companies already were making rapid progress in implementing their business plans of “migrating” their customers from traditional managed care plans to so-called “consumer-directed” plans, the industry euphemism for high-deductible policies. At the same time they’ve been requiring us to pay more out of our own pockets for care, they’ve also been implementing a strategy of reducing benefits.  Investors and Wall Street financial analysts refer to these common industry practices as “benefit buydowns.” That’s another euphemism, by the way.

I myself — and thousands of my fellow Cigna employees — were notified several years ago, long before I left my job, that our HMOs and PPOs were being discontinued. Yep, we got notices in the mail. If we wanted to stay in a Cigna-subsidized health plan, we would have to switch to a high-deductible plan. The same thing has happened to tens of millions of other Americans in recent years.

Yet if you relied on the Washington media for your news and information about health care, you’d think that insurance companies would never have considered sending policy discontinuation notices to their policyholders until forced to do so by Obamacare.

The truth: they have always done this when profits were at stake.

Which is why some insurers will be happy as clams to be able to keep their policyholders in plans that don’t meet the ACA’s standards. Many of those plans — especially the junk insurance plans many folks are in — are exceedingly profitable.

For people who are in those plans who have complained about their discontinuation notices, I hope they will shop around. Chances are, they’ll be able to get much better coverage at a better price. Thanks to the Affordable Care Act.

 

By: Wendell Potter, The Center for Public Integrity, November 18, 2013

November 20, 2013 Posted by | Affordable Care Act, Health Insurance Companies | , , , , , , , | 3 Comments

New Health Insurance Rules Would Let Consumers Compare Plans In “Plain English”

What would your health insurance cover if you got pregnant? How much could you expect to pay out of pocket if you needed treatment for diabetes? How do your plan’s benefits compare with another company’s?

Starting as soon as March, consumers could have a better handle on such questions, under new rules aimed at decoding the fine print of health insurance plans.

Regulations proposed by the Obama administration on Wednesday would require all private health insurance plans to provide current and prospective customers a brief, standardized summary of policy costs and benefits.

To make it easier for consumers to make apples-to-apples comparisons between plans, the summary will also include a breakdown estimating the expenses covered under three common scenarios: having a baby, treating breast cancer and managing diabetes.

Officials likened the new summary to the “Nutrition Facts” label required for packaged foods.

“If you’ve ever had trouble understanding your choices for health insurance coverage . . . this is for you,” Donald Berwick, a top official at the Department of Health and Human Services, said at a news conference announcing the proposal.

“Instead of trying to decipher dozens of pages of dense text to just guess how a plan will cover your care, now it will be clearly stated in plain English. . . . If an insurer’s plan offers subpar coverage in some area, they won’t be able to hide that in dozens of pages of text. They have to come right out and say it.”

Industry representatives said complying could prove onerous for insurers. “Since most large employers customize the benefit packages they provide to their employees, some health plans could be required to create tens of thousands of different versions of this new document — which would add administrative costs without meaningfully helping employees,” Robert Zirkelbach, press secretary for the industry group America’s Health Insurance Plans, said in a statement.

Insurance shoppers would also have to keep in mind that their actual premiums could change after they finalized their application, particularly in the case of plans for individuals, which can continue to adjust benefits based on detailed analysis of members’ health history over the next three years. (After 2014, the health-care law will essentially limit insurers to considering only three questions about applicants: how old they are, where they live and whether they smoke.)

The regulation, which is subject to a 60-day public-comment period, essentially fleshes out details of a mandate established by the the health-care law. But it also clarifies a question that the law left somewhat ambiguous: How soon into the application process can shoppers get the summary from insurers?

The regulations would require insurers to provide the summary on request, rather than waiting until someone applies for a policy or pays an application fee, a position that drew praise from consumer advocates.

“If consumers are really going to be able to compare their options, they should be able to easily get this form for any plan that they would like to consider,” said Lynn Quincy, senior health policy analyst for Consumers Union, the nonprofit publisher of Consumer Reports.

In addition to supplying the summary on demand, insurers would have to automatically provide it before a consumer’s enrollment, as well as 30 days before renewal of their health coverage. Plans must also notify members of any significant changes to their terms of coverage at least 60 days before the alterations take effect.

The summary form, which can be sent by e-mail, must be no longer than four double-sided pages printed in 12-point type. In addition to listing a plan’s overall premiums, co-pays and co-insurance amounts, it must include charts specifying the out-of-pocket costs for a range of specific services. A copy can be viewed at www.healthcare.gov/news/factsheets/labels08172011b.pdf.

By: N. C. Aizenman, The Washington Post, August 17, 2011

August 19, 2011 Posted by | Affordable Care Act, Consumers, Corporations, Government, Health Care, Health Reform, HMO's, Insurance Companies, Pre-Existing Conditions, President Obama, Public, Regulations | , , , , , , , , , , , , | Leave a comment

“Revere America”: Another Conduit For A Super-Wealthy Family To Influence Elections

On March 23, 2011 a group called Revere America issued a dire-sounding PRNewswire press release titled, “Americans Fear Loss of Freedom on Anniversary of Health Care Reform Law.” It warned that “a majority” of Americans view health care reform as “a threat to their freedom” and cited a poll by Bill McInturff of Public Opinion Strategies to prove it. The release came well after Revere America had spent $2.5 million on attack ads in the 2010 mid-term elections to defeat Democratic candidates in two states — New York and New Hampshire — who had voted in favor of health care reform. Just prior to the mid-term elections, in the autumn of 2010, Revere America ran a a slew of false and misleading attack ads against the health care reform bill that erroneously called health reform “government-run healthcare” (a Republican and insurance industry buzz-phrase). The ads said that the new law will result in higher costs and longer waits in doctors’ offices. In another false claim aimed at inducing fear, the ads told viewers that “your right to keep your own doctor may be taken away.”

But who, or what, is Revere America? And how did it pull together enough money in less than a year to run a multi-million-dollar attack ad campaign, engage an expensive, professional polling firm and pump their message out on PRNewswire?

“Revere America”: Another Veil for a Wealthy Family

Revere America (RA) is a Delaware-based advocacy organization that sprang up in April, 2010. Like so many similar groups springing up after the Supreme Court’s ruling in Citizens United, RA is set up in a way that allows it to accept corporate donations, and that keeps it from having to reveal its funders. RA’s titular head at the time of its startup was former New York Governor George Pataki. The group pushes to repeal health reform, also known as the Patient Protection and Affordable Care Act, which Pataki described a “horrific” and “costly bungle.” Donations to RA are not tax deductible, which would seem to make donating huge sums of money to the group less attractive to large numbers of people if it was a real grassroots group made up of ordinary people.

The Collier’s Hamilton Yacht ClubBut it turns out that Revere America is not made up of ordinary people, and its primary funder isn’t all that concerned about money. According to Citizens for Responsibility and Ethics in Washington (CREW) and other sources, Revere America’s primary funder is Parker J. Collier of Naples, Florida, the wife of Miles Collier, a wealthy Florida land baron and real estate developer. Ms. Collier has given half a million dollars to the Republican Party of Florida, $60,800 to the Republican National Committee, and gave an overall total of $1,239,014 to Republican interests — and that was just in 2009-2010.

The Collier money flowing towards Republicans and Revere America is old family money. Parker’s husband, Miles Collier, is the grandson of Barron Collier, who bought over a million acres in south Florida in the early 1900s, and after whom Collier County, Florida is named. Through their company, Collier Enterprises, the Colliers develop tony yacht, golf and members-only country clubs in southwest Florida, where the rich play, dine and sail. In recent years, Collier Enterprises has even been developing entire towns in Florida.

Influencing Elections Throughout the U.S.

The Collier’s private, members-only golf clubFor the Colliers, though, it apparently isn’t enough to have all the amenities of uber-wealth. Through Revere America, the family’s apparent political front group, the Colliers have also been using their money to influence elections throughout the rest of the country. They have financially supported far-right Republican candidates not only in New York and New Hampshire, but in many other states, including Michele Bachmann (R-Minnesota), Senator Scott Brown (R-Massachusetts), and Republican Sue Lowden in her failed primary bid to gain the Senate nomination in Nevada, to name just a few. The list of Republican candidates RA funded and Democrats they worked to defeat in the 2010 election cycle numbers over 100, with some elections meriting six figure donations — amounts that far exceed what individuals can legally donate to influence an election. 

The professional Republican pollster doing work for RA, Bill McInturff, conducted the message and advertisement testing for the infamous “Harry and Louise” television commercials that helped defeat the Clinton-era health care reform effort. Some of McInturf’s other clients include insurer Blue Cross Blue Shield Association, America’s Health Insurance Plans (the health insurance industry’s lobbying group) and drug maker Pfizer — all of which have a stake in undermining health care reform.

Pataki resigned as RA’s chairman in February, 2011, citing a Florida judge’s ruling the same month that the new health reform law’s federal mandate to purchase health insurance is unconstitutional. Pataki cited this ruling, and the House of Representatives’ symbolic vote to repeal health reform, as creating a good time for him to step down, and as proof that RA had been “successfully launched.” RA’s spokesperson and president is now Florida attorney Marianne R.P. Zuk, who is listed in Florida incorporation records as an officer or director for several Collier-owned companies.

Revere America is a “grassroots group” for the uber-wealthy Collier family in the same way that Americans for Prosperity is a “grassroots” group for the uber-wealthy Koch brothers. Such groups are conduits through which the super-rich are increasingly exerting powerful influence over elections nationwide. RA is yet another group that demonstrates the growing trend in which the wealthiest Americans — in the forms of both human beings and corporations — use their money to create fake “grassroots” front groups to hide behind and influence elections across the U.S.

Be on the look out for many more such groups to crop up in the future as the richest one or two percent of U.S. citizens come under increasing pressure to pay their fair share of taxes, and as we move closer to the 2012 elections. 

By: Anne Landman, Center for Media and Democracy, April 8, 2011

April 9, 2011 Posted by | Affordable Care Act, Big Business, Big Pharma, Class Warfare, Conservatives, Corporations, Elections, Freedom, GOP, Health Reform, Ideologues, Individual Mandate, Koch Brothers, Liberty, Pharmaceutical Companies, Politics, Republicans, Right Wing, Wealthy | , , , , , , , , , , , , , | Leave a comment

   

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