Congressional Democrats Threaten To Punish Anti-Health Care Reform Insurance Industry With $100 Billion In Fees

Politico, Reuters----

With other industry groups pledging savings to help pay the cost of health care reform, Senate Finance Committee Democrats slammed insurers for holding out — and threatened to impose new fees on the industry that could cost it as much as $100 billion.

The Finance Committee members are currently hunting for hundreds of billions of dollars to help finance reform, and with the hospital and pharmaceutical industries having pledged $235 billion, the senators said it was time that the insurers paid their share.

“We need the insurance companies to step up to the plate and be part of the solution. Most of the negotiations so far, the insurance industry has been at the table but you can only sit there at the table with your arms crossed for so long,” said Sen. Chuck Schumer (D-NY).

Schumer and Sens. John Rockefeller (D-WV), Debbie Stabenow (D-MI) and Robert Menendez (D-NJ) pounded the insurers, who they portrayed as unwilling to help pay for reform even while they have enjoyed exploding profits.

“The insurance companies are the people who are just rapaciously, greedily and unstoppably making money by underpaying the patient, by underpaying the provider and by overpaying, therefore, themselves,” Rockefeller said.

Democrats have yet to lay out exactly what those fees would be, but they would go toward footing what they see as insurers' share of the cost of health care reform.

Phil Blando, a health care consultant whose clients include health insurers, said it’s not surprising to see Democrats attacking health insurers as public support for reform softens.

“With consensus among Democrats elusive, this appears to be an effort to redirect the debate squarely at the private sector. A key question for the next month is which argument will prevail – the need to rein-in the private sector or growing concerns about the cost of financing health reform,” he said.

Schumer pointed to the profits of the 10 largest insurance companies — which shot up 428 percent between 2000 and 2007, from $2.4 billion to $12.9 billion — as a reason health care reform is needed.

The industry’s trade group, America’s Health Insurance Plans, said health plans have proposed reforms such as guaranteed coverage for pre-existing conditions and discontinuing premiums based on a person’s health status or gender.

“As families and small businesses struggle during the current economic slowdown, now is not the time to impose new fees on health care coverage that will make coverage less affordable. To make health care more affordable policymakers should focus on initiatives that promote value and make the system work better and more efficiently,” said AHIP spokesman Robert Zirkelbach.

But Schumer said they are working to make sure the fee can’t be passed through to consumers. Additionally, a strong government-run insurance plan that competes with the private market will make it more difficult for insurers to pass along the increased costs.

At least one Republican committee members seems receptive to the idea. Said Sen. Olympia Snowe (R-Me.), “I personally wouldn’t have a problem with that.”



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Sources: Politico, Reuters, Zimbio, Google Maps