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AHIP and the Effort to Kill Reform

Carl Mercurio — Wed, 13 Jan 2010 16:51:30 +0000

I suppose that the October release of a flawed and biased study suggesting that healthcare reform would cause insurance premiums to soar (see prior post) was proof enough that America’s Health Insurance Plans had shifted gears and was now actively trying to kill reform. I, however, clung to the belief that the association — long recognizing the writing on the wall — was still in favor of “reform” but was seeking concessions:

Why kill something that gives you most of what you want, i.e., no public option and no serious consideration of single-payer healthcare. I do think the industry is still lobbying for a stronger insurance coverage mandate to address the likelihood that the young and healthy will simply pay a small fine rather than buy health insurance.

After all, AHIP still supported guaranteed issue and some form of community rating….Right?

Then there was the report of an industry rift — with Blue Cross Blue Shield plans stepping up the anti-reform rhetoric, according to The Wall Street Journal, even as other big players like Aetna were seeking to mend fences after the October fallout. O.K., but this could still be just another example of fighting for “the right kind of reform.” After all, didn’t Blue Cross Blue Shield of North Carolina end up killing those planned Harry & Louise-esque commercials it had on the drawing board (see prior post)….Right?

Comes now a report that since September AHIP has been quietly soliciting funds from its members — some $10 million to $20 million from six major health plans — and funneling the money to the U.S. Chamber of Commerce to help subsidize “third-party television ads aimed at killing or significantly modifying the major health reform bills moving through Congress.” The six plans named in the article are Aetna, Cigna, Humana, Kaiser, UnitedHealth Group and WellPoint.

Below are two examples of the types of commercials the Chamber has run through the Campaign for Responsible Health Reform and Employers for a Healthy Economy. Let’s see, how can this be spun by someone like me who actually believed AHIP had seen the light — well to some extent at least? I’ve got it! As Matthew Holt noted in The Health Care Blog, insurers are the “poor suckers” in reform because the industry signed on for guaranteed issue and community rating but didn’t get a strong mandate to avoid adverse selection — a valid point. So I guess you could argue that all AHIP is doing is fighting for justice…Right?….All of a sudden I’m not feeling so well.

Posted in Healthcare Reform

Aetna “Somewhat Insulated” from Reform, Bertolini Says

Carl Mercurio — Tue, 03 Nov 2009 19:23:12 +0000

Speaking at the Oppenheimer healthcare conference in New York today, Aetna president Mark Bertolini said his company is “somewhat insulated from reform” because 85% of the company’s membership is in large groups (i.e., 50+ employees). Most of the impact of reform will be felt by companies with lots of individual and small group members, such as Blue Cross Blue Shield plans. About 6% of Aetna’s membership is in small groups (2-49 employees) and 2% is in individual. This backs up an argument put forward in The Wall Street Journal (see prior post) suggesting that the varied interests of health plans has caused an indudtry rift over whether to support or oppose reform. Bertolini also pointed to some challenges the company faces in 2010, including the potential for additional in-group attrition and COBRA uptake related to the economy, medical cost and pricing pressures, uncertain risk membership, lower Medicare reimbursement and increased selling, general and administrative costs. The company maintains a “bias toward profitability over growth,” he said, meaning Aetna will sacrifice membership for margins.

Posted in Managed Care

Rift Among Health Insurers Over Reform?

Carl Mercurio — Fri, 23 Oct 2009 13:07:18 +0000

Click here for an interesting piece in The Wall Street Journal suggesting there’s a rift among health insurers over reform — with some wanting to “go negative” and others wanting to support the reform effort. Not surprisingly, the Journal suggests, business interests are behind the divergent views:

Ron Williams, Aetna Inc.’s chief executive, has been working with the White House and Senate Finance Committee in an attempt to mend a rift between insurers and Democrats sparked by an industry-funded study critical of the measure. But the Blue Cross Blue Shield Association continued to step up the rhetoric against the legislation by releasing its own study Wednesday critical of the bill.

The split in the industry shows how varied the interests of insurers are. Mr. Williams’s company, which largely administers health benefits for large corporations, has less to lose in an overhaul than insurers who sell policies to individuals and small employers, as many Blue Cross plans do. That area of the insurance market is the one that will likely face significant new restrictions on the way insurers can price policies, restrict coverage and compete with other plans.

Posted in Healthcare Reform