AHIP's welfare plan for private insurers
We Believe Every American Should Have Access to Affordable Health Care Coverage A Vision for Reform
America’s Health Insurance Plans (AHIP)
Our proposal to expand access to health insurance coverage is built upon five principles that are designed to clearly delineate the responsibilities of the private and public sectors, avoiding duplication, providing a framework for complementary strategies, and maximizing the effectiveness of a system-wide effort to improve quality and reduce costs.
Principle 1: The federal government should provide incentives to states to develop strategies that lead to - and sustain - coverage of children within three years and adults within 10 years.
Principle 2: The federal government should establish incentives for states to provide coverage through the Medicaid program for all adults with incomes
under 100 percent of the federal poverty level (FPL), including single adults, and through the State Children’s Health Insurance Program (SCHIP) for children under 200 percent of the federal poverty level. States should have the option to exceed these levels for SCHIP to the extent necessary to maintain enrollment of existing populations.
Principle 3: The federal government should provide subsidies for the purchase of private coverage to individuals and families with incomes under 400 percent of the FPL. Individuals with incomes under 300 percent of the FPL should receive proportionally greater assistance, with assistance levels phasing down for individuals with incomes approaching 400 percent of the FPL. Individuals who are eligible for premium subsidies should be encouraged to purchase coverage through existing market mechanisms. Employed individuals who are eligible for employer-sponsored coverage should be encouraged to use their premium subsidies to enroll in such coverage.
Principle 4: The 6 million uninsured Americans with incomes over 400 percent of the FPL should be encouraged to purchase coverage. This proposal sets out a range of options states should consider to achieve this goal. To help create a level playing field for individuals purchasing coverage on their own and for those who have employer coverage, full tax deductibility of premiums purchased in the individual market should be granted.
Principle 5: Employers should be encouraged to facilitate, provide, and maintain coverage for their employees. This proposal sets out a range of options states should consider to achieve this goal. In addition, the federal government should not disrupt employer coverage by changing the current tax treatment of employer-provided coverage.
http://www.ahipbelieves.com/Portals/0/docs/vision_of_reform.pdf
HealthCast video of AHIP’s release of the proposal:
http://www.kaisernetwork.org/health_cast/hcast_index.cfm?display=detail&hc=1974
Comment:
By Don McCanne, MD
AHIP, representing the nation’s private insurers, is currently being lauded for taking a leadership role in promoting policies encouraging universal access to affordable health care coverage. Are the accolades warranted?
The proposals do seem to meet what many consider to be the political common ground for reform. The expansion of coverage is incremental, beginning with children. The goal is universal coverage that is affordable for everyone.
The process builds on the current system rather than replacing it with a single, government-run program. Though politically expedient, is this the common ground where we really want to be?
AHIP’s primary mission is to protect the interests of the private insurers. They want to continue to market affordable plans to healthy populations that have a source to pay for the insurers’ products. Most employed individuals and their families are healthy and have, through their employment, the resources to purchase insurance. The insurance industry wants to retain that market. Many of the uninsured are also employed and healthy, but lack the resources to pay for coverage. The insurance industry also would like to have this market, and so they have proposed government subsidies to help pay for that coverage. They also propose subsidies for the higher-income uninsured in order to entice them as well to buy their products.
Individuals living in poverty have poor employment records and have a high incidence of chronic problems, especially socio-economic difficulties. The insurance industry does not want to cover this market since there is very little profit incentive in including these less fortunate individuals. Thus AHIP recommends turning these individuals over to a government welfare program, Medicaid, thereby sparing the industry of this burden.
What a great program for the insurers. They cover the healthy with well funded plans, and turn the problem sectors over to the government and the taxpayers.
Besides being extremely self-serving, there are serious deficiencies in their proposals. They are supporting affordable coverage, but not affordable health care. Reading the specifics of their proposals, it is clear that they have no mechanism for slowing health care inflation. Instead, they support proposals that shift more costs to individuals, making access less affordable. Rather than reducing the profound administrative waste in our system, they increase administrative inefficiencies, further adding to health care costs. They have no proposal to pay for the increased government spending, knowing that a massive tax increase, without an offset in reduced private spending, would blow a crater in a common ground on reform. Also, their program cannot possibly achieve 100 percent coverage since much of it requires voluntary participation.
The greatest flaw of all is that their plans are made affordable by increasing financially burdensome cost sharing, by reduction in benefits covered, and by excluding those with health care needs. If these patterns were reversed, then coverage would not be affordable. The private insurance model is an anachronism.
The political common ground for reform should be on policies that ensure that everyone has affordable access to comprehensive health care, rather than on policies that increase wasteful spending through a government program designed for the welfare of private plans. It’s time for taxpayer/patients, providers, and politicians to join together on a common ground to fix our system. But we do need to acknowledge that AHIP and the private insurers have disqualified themselves from being legitimate participants in that process.