Monday, August 03, 2009

Health Insurance Industry and Health Care Reform

In today's Times, Michael Hiltzik provides us with a succinct account of the shenanigans if not machinations of the health insurance industry as it fights to gut meaningful health care reform in this country:

[I]f the insurers have proved anything over the last 15 years as the health crisis has gathered speed like an avalanche roaring downhill, it's that they're part of the problem, not the solution.

The firms take billions of dollars out of the U.S. healthcare wallet as profits, while imposing enormous administrative costs on doctors, hospitals, employers and patients. They've introduced complexity into the system at every level. Your doctor has to fight them to get approval for the treatment he or she thinks is best for you. Your hospital has to fight them for approval for every day you're laid up. Then they have to fight them to get their bills paid, and you do too.

One Wendell Potter reminded a Senate committee in June that health insurance executives had assured Congress in 1993 that they would work to secure universal medical coverage and end denials of coverage to people with pre-existing conditions. Then they moved heaven and earth to kill reform.

They've made the same promises now, Potter observed. But they're in an even better position to throttle reform. Mergers and acquisitions have turned the industry into a cartel of huge corporations.

"The industry is bigger, richer and stronger, and it has a much tighter grip on our healthcare system," he said. The last thing they want is a government program set up as their competition.

Potter knows the insurers' ways because he was a top executive in the industry for 20 years. But the hard numbers bear him out. The two largest insurers, WellPoint and UnitedHealth Group, each acquired 11 other insurers between 2000 and 2007. They now control a total of 67 million "covered lives" (that's customers in health insurance-speak).

This consolidation has produced functional monopolies in communities across America. The American Medical Assn. (itself no great fan of reform) found in a 2007 survey that in 76% of the country, defined as its major metropolitan statistical areas, one insurer had a share of 50% or more of the conventional insurance market. This phenomenon gives the companies enormous power to drive up premiums and maximize profits. [....]

You've heard of the Blue Dog Democrats, those mostly rural conservatives who blocked a summertime vote on reform legislation on Capitol Hill? According to the Center for Public Integrity, the biggest backer of the Blue Dogs’ political action committee is the healthcare industry, which is on the path to pumping a total of $1.2 million into the PAC's maw in the current 2009-10 election cycle.

Then there's the advocacy group called the Campaign for an American Solution, which describes itself as "a grass-roots effort . . . to build support for workable healthcare reform." The organization owns up to being an "initiative" of America’s Health Insurance Plans, or AHIP, the industry's chief lobbying arm. Unless I've missed a radical change in lawn and garden horticulture, you can't get much further from the grass roots than to be a creation of the industry with the biggest stake in the debate. [....]

Please read the whole article.

Addendum: "A Canadian doctor diagnoses U.S. healthcare," that is to say, a "caricature of 'socialized medicine' is used by corporate interests to confuse Americans and maintain their bottom lines instead of patients' health" (also in today's Times).

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