Health Insurance Companies Seek Health Insurance ReformDue to the radical changes in health care law the health insurance industry has begun pouring money into the Republican Party in hopes of convincing conservatives to hold the status quo.
When first faced with the new law industry lobbyists were overwhelmingly in favor of President Obama’s motion to require all American citizens to carry health care insurance. Millions of new clients would bring in billions of dollars for the insurers. When the plan to create a public
medical insurance option to compete with private companies was dropped, the law seemed like a dream come true for the health insurance industry.
However, the law also forces insurance companies to relax coverage requirements for higher risk clients. It prohibits them from refusing coverage to ill children and prevents them from cancelling policies or raising premiums when the policy holder gets sick.
Insurance companies also fear that federal oversight of
premiums and minimum requirements for benefits will be the next step.
In 2014 insurers will face regulations as to how much they can vary premiums based on age, and this will cause a rise in premiums for younger policy holders. Industry insiders claim that making these mandated concessions will drive the overall cost of health insurance up for everyone. Supporters of the legislation, on the other hand, hope that the increase in policy holders will mitigate the rise in costs.
The goals of making health insurance available to everyone, and making health insurance more affordable, seem to be mutually exclusive for now.
In 2009, health insurance industry donations were split evenly between the Republican and Democratic parties. Though they were originally in favor of Obama’s radical changes, in 2010 health insurance companies are donating over three times as much money to the Republican Party.
Wellpoint Inc., who was slammed by Democrats for proposing exorbitant hikes for
California rates, has donated over nine times more to the Republicans Party this year.
Insurance companies hope to convince the GOP to make efforts to keep the requirement for all citizens to carry health insurance, but scrap the mandates for relaxing policy qualifications.
In the past, Republicans have been responsible for pro-insurer legislation like Medicare Advantage Plans, which rely on subsidies from the federal government. They have also facilitated a shift towards increased consumer costs through high-deductible policies. The Obama Administration’s goals are to lower health insurance costs for the consumer and lower government subsidies, while raising responsibility and competition between insurers – no wonder the health insurance companies are frantically throwing money at the other side.