Making The Health Law Work - For Insurers

Health insurance companies have a great system going for them. They make inordinate amounts of money and then use that money to buy legislative influence so that they can make more inordinate amounts of money.

Who wouldn’t want to be a part of a system like that – if you are the one raking in the cash, not the one who pays it out.

A Chicago Tribune report,,0,6752608.story, spells out in detail the flood of money being provided by insurance companies to Republican candidates hopefully headed for Washington.

Now that the Democrats have passed a health law which greatly expands the market for health insurance companies, they have switched allegiance to the Republicans in an effort to elect Congressmen and Senators who will severely restrict those parts of the law which insurers don’t like and curb the reach of regulations to be formulated pursuant to the health law.

In 2009, the Tribune found from federal election filings, that donations to the two major political parties from the five largest insurance companies and their Washington-based lobbying arm was almost equally divided. This year, these insurers have given more than three times more in contributions to Republican campaigns than to Democratic ones.

Why the sudden change? In 2009, the legislative branch was locked in an epic struggle over the issue of enlarging health insurance coverage in the nation. A major issue was forcing everybody in the country to buy health insurance. Since there were 45 million people without health insurance, what an expansion of the insurance market for the companies! So, they did everything they could to see that, at least, this part of the expansion became law.

They succeeded and got the increased market. But, then they looked at the entire law and found that there were parts of it that actually favored policyholders and would tend to curb insurance company profits. So, the companies shifted gears and decided to back the people who opposed the law so that they could milk them for the legislative and regulatory “fixes” the insurers want.

Any person who thinks about it has to come to the conclusion that an insurance pool cannot work if the people who are most likely to need the insurance are the only ones in the pool. Unless many who will not require the insurance pay premiums just to play safe, there would not be enough funds in the pool to pay the claims of those most at risk.
So, just as automobile insurance is required from all, so health insurance will be required from all.
But, having obtained this treasure trove of possible new business, the insurers then set about paring the potential amount of benefits they would have to pay. They have a laundry list of items they want to cut or excise from the law. After all, they have what they want in the way of potential business, now it’s time to cut down on potential payouts.

Some of the things in the new health law that have insurance companies on the warpath are:

* Prohibiting denial of coverage to sick children
* Prohibiting canceling policies when policyholders get sick.
* Prohibiting lifetime caps on benefits to disabled consumers.
* Policyholders will receive new appeal rights when a claim has been denied.
* Insurers will have to cover payment for more preventive care for their policyholders.
Which just goes to show:

To the policyholder, health insurance is a life-saving mechanism which hopefully protects the family in the event of disaster.

To the insurance company, health insurance is a cash cow which keeps on giving and giving and giving…