PNHP

Continued insurer discrimination assured

Discrimination by Insurers Likely Even With Reform, Experts Say

By David S. Hilzenrath
The Washington Post
October 4, 2009
If insurers are prohibited from openly rejecting people with preexisting conditions, they could try to cherry-pick through more subtle means. For example, offering free health club memberships tends to attract people who can use the equipment, says Paul Precht, director of policy at the Medicare Rights Center.
Being uncooperative on insurance claims can chase away the chronically ill. For people who have few medical bills, it is less of a factor, said Karen Pollitz, research professor at the Georgetown University Health Policy Institute.
And to avoid patients with costly, complicated medical conditions, health plans could include in their networks relatively few doctors who specialize in treating those conditions, said Mark V. Pauly, professor of health-care management at the University of Pennsylvania’s Wharton School.
At a more nuts-and-bolts level, AHIP has been trying to shape the legislation in ways that could help insurers attract the healthy and avoid the sick, though it has given other reasons for advancing those positions.
By itself, a ban on discrimination would not eliminate the economic pressure to discriminate.
“It would probably increase the incentive for cherry-picking,” Pauly said.
http://www.washingtonpost.com/wp-dyn/content/article/2009/10/03/AR2009100302483_2.html

No matter how tightly regulated, investor-owned private insurers will always find ways to avoid enrolling those with greater health care needs. To fulfill their business responsibilities they are mandated to control costs in any way possible. To remain competitive and survive, nonprofit insurers must follow their lead.
A public insurance program has a mission of assisting individuals in getting the care they need. It is especially important to include those who have greater needs.
What does this say about a stand-alone “public option” that competes with private plans on a level playing field by being fully funded by the beneficiaries? Adverse selection would drive the premiums sky high, and the program would fail.
Would we really want our government to engage in the same injustices of the marketplace in which the public administrators would devise schemes to exclude higher cost patients from the government program, just so they could keep the premiums competitive? Of course not. Almost everyone agrees that the government should serve as the safety net, and yet the proposed public option safety net is all holes and no mesh.
If the government were in charge of our health insurance, we would expect it to provide all of us with the coverage that we need. Yet when the private sector is in charge, we reward it richly for devising ways of preventing us from having the coverage that we need.
Maybe before we do anything else, we need to address our pervasive cognitive dissonance.

Continued insurer discrimination assured

Discrimination by Insurers Likely Even With Reform, Experts Say

By David S. Hilzenrath
The Washington Post
October 4, 2009

If insurers are prohibited from openly rejecting people with preexisting conditions, they could try to cherry-pick through more subtle means. For example, offering free health club memberships tends to attract people who can use the equipment, says Paul Precht, director of policy at the Medicare Rights Center.

Being uncooperative on insurance claims can chase away the chronically ill. For people who have few medical bills, it is less of a factor, said Karen Pollitz, research professor at the Georgetown University Health Policy Institute.

And to avoid patients with costly, complicated medical conditions, health plans could include in their networks relatively few doctors who specialize in treating those conditions, said Mark V. Pauly, professor of health-care management at the University of Pennsylvania’s Wharton School.

At a more nuts-and-bolts level, AHIP has been trying to shape the legislation in ways that could help insurers attract the healthy and avoid the sick, though it has given other reasons for advancing those positions.

By itself, a ban on discrimination would not eliminate the economic pressure to discriminate.

“It would probably increase the incentive for cherry-picking,” Pauly said.

http://www.washingtonpost.com/wp-dyn/content/article/2009/10/03/AR2009100302483_2.html

Comment:

By Don McCanne, MD

No matter how tightly regulated, investor-owned private insurers will always find ways to avoid enrolling those with greater health care needs. To fulfill their business responsibilities they are mandated to control costs in any way possible. To remain competitive and survive, nonprofit insurers must follow their lead.

A public insurance program has a mission of assisting individuals in getting the care they need. It is especially important to include those who have greater needs.

What does this say about a stand-alone “public option” that competes with private plans on a level playing field by being fully funded by the beneficiaries? Adverse selection would drive the premiums sky high, and the program would fail.

Would we really want our government to engage in the same injustices of the marketplace in which the public administrators would devise schemes to exclude higher cost patients from the government program, just so they could keep the premiums competitive? Of course not. Almost everyone agrees that the government should serve as the safety net, and yet the proposed public option safety net is all holes and no mesh.

If the government were in charge of our health insurance, we would expect it to provide all of us with the coverage that we need. Yet when the private sector is in charge, we reward it richly for devising ways of preventing us from having the coverage that we need.

Maybe before we do anything else, we need to address our pervasive cognitive dissonance.