Health Care Insurers Vs. Obama Administration: Children's Coverage

HHS Hits Insurers On Kids' Coverage


The Obama administration is taking health insurers to task again, this time for choosing to no longer sell plans intended to cover sick children, but gave the industry some new flexibility in implementing a problematic provision of the health care overhaul.

Many insurers have said in recent weeks that they would stop selling "child only" insurance plans because the overhaul requires them to accept all applicants, even if they apply for coverage at the last minute before treatment. Insurers say the provision, which went into effect Sept. 23, allows patients to game the system.

That's angered Health and Human Services Secretary Kathleen Sebelius, who said in a letter to the industry late Friday that insurers are operating in bad faith. She cited a March letter in which the trade group America's Health Insurance Plans said, "health plans recognize the hardship that a family faces when they are unable to obtain coverage for a child with a pre-existing condition."

AHIP said its members would abide by the provision. For many insurers, that meant leaving the niche market entirely to avoid getting all of the most expensive patients — or "adverse risk selection."

"While we appreciate the concerns of insurers and [state insurance] commissioners about adverse risk selection, and want to clarify what legal options exist, the plight of millions of parents who desperately want to provide health coverage and critical treatments for their children is a top priority, and we would hope that insurers who have for years offered child-only policies to healthy children would not deny coverage to families who desperately want to purchase health insurance," Sebelius wrote to AHIP. She sent a similar letter to the Blue Cross Blue Shield Association.

Insurers say they've been working with the administration since last spring to come up with a solution that would ensure children get coverage while minimizing disruption to the market and cost increases.

"That process has worked well in the area of family coverage," said Robert Zirkelbach, spokesman for AHIP. "In the small but critically important niche market for child-only policies a powerful incentive has been created for parents to defer purchasing coverage until after their children need it. Plans are therefore having to make very difficult decisions about offering new child-only coverage."

HHS also issued new regulatory guidance that could make it easier for insurers to sell the policies. The agency said insurers could raise rates based on health condition — though doing so will be illegal beginning in 2014; issue different rates for child-only policies and dependent children; impose a surcharge for dropping coverage and subsequently reapplying; and instituting rules to preventing "dumping" the policies.

The moves are likely to drive premiums up, if insurers choose to start selling the policies again.

Sebelius also said she welcomes state laws that would force insurance companies to cover these children if the company offers similar coverage to adults. Insurers won't have to cover all adults regardless of pre-existing conditions until 2014 under the health reform law.

"The administration is determined that children and families receive the full benefits provided to them in the Affordable Care Act," Sebelius wrote.

The agency has already said insurers could establish an open enrollment period — say, of approximately a month — in which insurers could sell policies and still legally close access the rest of the year. HHS said Friday that it would consider a uniform open enrollment period "only if it would result in issuers selling new child-only policies."


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Sources: BCBS, Politico, Wikipedia, Youtube, Google Maps

Pres. Obama Slams Health Care Providers For Rate Hikes...Weekly Address

Weekly Address: Premiums, Profits, And The Need For Health Reform

The President points to outrageous premium hikes from health insurance companies, especially those already making massive profits, as further proof of the need for reform. Looking ahead to the coming bi-partisan meeting on reform, the President urges members of Congress to come to the table in good faith to address the issue.



Sources: Whitehouse.gov,

Health Care Stocks Are Hot Again, Lobbyists Win!

Visit msnbc.com for breaking news, world news, and news about the economy

Health Care Insurance Company Stocks "On Fire!" – They’re Winning, We’re Losing



If you need a guide to the health reform debate in Washington, take a look at health insurance company stocks.

When the debate is going the right way – towards quality, affordable health care for everyone, towards getting people out from under the insurance industry’s crushing monopoly – insurance company stocks take a dive. When the debate is moving against what America wants – towards more private industry, less insurance regulations, and the like – health care stocks soar.

Right now, they’re soaring. The Indianapolis Star goes into more detail:

Shares of the Indianapolis-based health insurance giant surged to a 52-week high Thursday as the prospects for a new government-run "public option" health plan faded amid intense Senate debate. WellPoint rivals Cigna and UnitedHealth Group also hit 52-week highs.

It’s a sign, more than one observer suggested, of victory for private health insurers, which strenuously fought the Public Option.

"Obviously, the market thinks WellPoint’s a winner," said Daniel Evans, chief executive of Clarian Health, an Indianapolis-based hospital system. "If the public option is no longer on the table, then WellPoint is a winner because it’s not threatened by a government competitor."

Wall Street is what has turned our nation’s health care companies into profiteers.

16 years ago, before most of the insurance companies were publicly traded, they spent 95% of premium dollars on health care. That level is comparable to Medicare, which spends 97% of premium dollars on care. But once these companies went public and started trading on Wall Street, the relentless drive for profit drove down that percentage to where it sits today, at 81%.

Wall Street pressures directly caused insurance companies to deny more care. Wall Street accelerated the process by which insurance companies deny as much care as they can, which forces more people into bankruptcy (when they have to pay out of pocket for care their insurance company won’t cover) and leaves millions uninsured (if you’re bankrupt, it’s hard to pay premiums). And being uninsured can be a death sentence.

The way Wall Street responds to the health care debate drives these companies. When insurance company stock prices catch fire as the public health insurance option is killed in the Senate, you can bet that these companies are watching and feel supported in their effort to kill any and all health reform that would hurt their bottom line.

Wall Street-run health care is the driving reason that if the insurance companies win, we lose.

Wall Street run health care is making huge profits right now. It’s also making Americans sicker and sicker. A health care reform bill that does not take away Wall Street’s power – one without a public option, one that doesn’t mandate insurers spend 90% of their premiums on care, one without strict regulations on denying care or charging more to certain customers – will tacitly support the way the health care business works now, with Wall Street in charge.

The Senate bill, in too many ways, is the Wall Street bill. The House bill stands up to Wall Street. That’s presents real problems for the American people, problems that must be fixed before this bill is sent to the President’s desk.



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Sources: Firedoglake, The Indianapolis Star, MSNBC, Morning Joe Show, AP, Google Maps

Pro-Life & Pro-Choice Voters Hate Senate Bill, BCBS Loves It

Negotiating To 60 Votes, Compromise By Compromise


30 million people without health insurance stand to gain coverage under a deal announced on Saturday by Senate Democrats.

To get the 60 votes needed to pass their bill, Democrats scrapped the idea of a government-run public insurance plan, cherished by liberals, and replaced it with a proposal for nationwide health plans, which would be offered by private insurers under contract with the government.

The legislation also includes a proposal that would limit insurance coverage of abortion. The provision, which was the last piece of the puzzle to fall into place, was negotiated by the Senate majority leader, Harry Reid, Democrat of Nevada, to win the support of Senator Ben Nelson, Democrat of Nebraska, who is an opponent of abortion.

Under the agreement, states could choose to prohibit abortion coverage in the insurance markets, or exchanges, where most health plans would be sold.

But if a health plan did cover the procedure, subscribers would have to make two separate monthly premium payments: one for all insurance coverage except abortion and one for abortion coverage.

The compromise was denounced by advocates of abortion rights, including the Planned Parenthood Federation of America, the National Organization for Women, Naral Pro-Choice America and the National Women’s Law Center.

“We have no choice but to oppose the Senate bill,” said Cecile Richards, president of Planned Parenthood.

The United States Conference of Catholic Bishops and the National Right to Life Committee reached a similar conclusion for very different reasons.

“This bill should not be supported in its current form because it would allow federal money to go to health insurance plans that cover elective abortions,” said Richard M. Doerflinger, a spokesman on abortion for the bishops’ conference.

The final deal was packed with provisions calculated to appeal to various constituencies. The bill would provide extra Medicaid money to Nebraska, long-term-care insurance to people with severe disabilities, new services for pregnant teenagers and financial breaks to nonprofit insurance companies.

But there were also potential losers. To bring in more revenue, the bill proposes a range of new fees and taxes that would affect some high-income people, profitable health insurance companies and people who use tanning salons.

The proposals were drafted by Mr. Reid as part of an amendment to a sweeping health care bill, which embodies President Obama’s top domestic priority.

Mr. Reid’s amendment would expand eligibility for a small-business tax credit, increase penalties on certain uninsured people and increase the payroll tax on higher-income individuals and families beyond the increase that Mr. Reid proposed last month.

Mr. Nelson — whose home state of Nebraska received the additional Medicaid money — embraced the bill on Saturday.

“A number of states are treated differently from other states,” Mr. Reid said. “That’s what this legislation is all about, compromise.”

The Senate Republican leader, Mitch McConnell of Kentucky, said the bill was “a monstrosity full of special sweetheart deals for a few states,” including Nebraska and Vermont.

Under Mr. Reid’s amendment, the federal Office of Personnel Management, which provides health benefits to federal employees, would sign contracts with insurers to offer at least two national health plans to individuals, families and small businesses. At least one contract would have to be with a nonprofit entity.

Blue Cross and Blue Shield companies could offer a single national plan. The new national plans would be separate from the program for federal employees, and premiums would be calculated separately.

Under the bill, most Americans would be required to have insurance. The penalty for violating this requirement could be as high as 2 percent of a taxpayer’s household income. Penalties would total $15 billion over 10 years, up from $8 billion under Mr. Reid’s original proposal, the Congressional Budget Office said.

In the next 10 years, the government would also collect $28 billion in penalties from employers who did not offer health benefits to employees.

Mr. Reid dropped a proposed tax on cosmetic surgery and replaced it with a tax on “indoor tanning services.” Senate Democrats said the 10 percent tax was justified because ultraviolet radiation from tanning devices could increase the risk of skin cancer.

The bill would significantly increase the Medicare payroll tax on people with high incomes. Workers now pay a tax equal to 1.45 percent of wages to help finance hospital care for Medicare beneficiaries.

Mr. Reid’s proposal would impose an additional tax: 0.9 percent of income above $200,000 for individuals and $250,000 for families. This is nearly twice the extra tax of 0.5 percent that he proposed last month.

To help finance coverage of the uninsured, the bill would levy annual fees on insurance companies and manufacturers of medical devices and prescription drugs. Under the proposal unveiled on Saturday, nonprofit insurance companies could be exempted if they spent a large share of their premiums on medical care rather than administrative costs.

Senator Carl Levin, Democrat of Michigan, had sought such an exemption to spare companies like Blue Cross Blue Shield of Michigan, which he said provided a valuable service as the “insurer of last resort.”

The biggest source of revenue under the bill is a new tax on employer-sponsored group health plans with high premiums. The bill provides a special dispensation to police officers, firefighters, miners and construction workers, who have high premiums because they work in high-risk occupations.

Mr. Reid would grant a similar dispensation to longshoremen.

In what they described as an effort to reduce the demand for abortion, Democrats would provide money to help pregnant teenagers and new mothers so that they could stay in high school and attend college.

The federal government would provide $25 million a year for a “pregnancy assistance fund.” The money could be used for “maternity and baby clothing, baby food, baby furniture and similar items,” the proposal says.

Children could benefit from Mr. Reid’s proposal in two other ways. He would immediately prohibit insurers from denying coverage to children because of pre-existing medical conditions. And he would provide money to extend the Children’s Health Insurance Program for two more years, through 2015, as proposed by Senator John D. Rockefeller IV, Democrat of West Virginia.





Blue Cross Blue Shield Lobbyists Quietly Helping Extreme Effort To Declare Health Reform Unconstitutional


Think Progess has documented how the private health insurance industry is waging a duplicitous, “two-faced” campaign to kill health reform. Because the industry understands that the public views it in a largely negative light, the industry presents itself as proactively working hand-in-hand with legislators to produce reform. However, behind the scenes, the industry is coordinating a massive effort to kill all reform — employing attacks from front groups, allied politicians, think tanks, lobbyists, and right-wing media.

The Blue Cross Blue Shield Association, which is a lobbying group representing 39 independent Blue Cross and Blue Shield Plans, is also engaged in this two-faced campaign. Like most of industry, the BCBS Association says it fully supports the concept of health reform, but continually demands drastic changes to the bills in Congress. Some have begun to question the BCBS Association’s claim of support given its new study attacking reform legislation in the Senate. The criticism of BCBS is bolstered by a new revelation that BCBS Association lobbyists are helping to orchestrate a right-wing movement to invalidate all of health reform.

Yesterday, the BCBS Association released yet another industry-sponsored study to distort health reform and falsely claim that premiums will skyrocket because of the legislation. However, the nonpartisan CBO reported earlier this week that under the Senate health reform bill, “most Americans would pay the same or less in premiums.” A New York Times editorial yesterday criticized BCBS Association’s study, and noted correctly that it is yet another example of the private insurance industry doing whatever it can to frighten Americans.

But while the study certainly damages BCBS’ credibility, BCBS is involved in another anti-health reform ploy that they do not bother to promote on the BCBS website. The American Legislative Exchange Council (ALEC), founded in 1973 by conservative activist Paul Weyrich, is a DC-based front group which helps state lawmakers craft corporate-friendly legislation. As the Atlantic has noted, ALEC developed template health care “states’ rights,” legislation to declare aspects of health reform unconstitutional. ALEC has promoted this “tenther” legislation using its network of mostly far right Republican state lawmakers. The bills, which have been adopted in some form in 24 states so far, aim to invalidate federal regulations of health insurance, the public option and the individual mandate using the Tenther Amendment.

According to the ALEC website, the resolution was developed by a three member task force of industry representatives. One of the of the members is Joan Gardner, who is executive director of state services with the BCBS Association’s Office of Policy and Representation. In an interview with ThinkProgress, Christie Herrera, the director of ALEC’s health task force, confirmed that Gardner played a pivotal role in crafting this anti-health reform states’ rights initiative. Herrera told us that Gardner’s unique position at the BCBS Association brought “great knowledge” to the issue, and that Gardner voted to press forward with the campaign.

Part of the reason the BCBS Association has claimed that it opposes the reform bill in its current form is because of what it perceives as a weak individual mandate. However, the BCBS Association-supported ALEC campaign depicts the very notion of an individual mandate as “anti-freedom.” So either way the Senate acts, BCBS will be able to trash the bill and try to kill reform.

Private insurers have already been caught using a stealth lobbying firm to send employees to rowdy town halls (and radical tea party events), sharing lobbyists with slash-and-burn anti-health reform attack groups, and paying a number of conservative pundits who regularly appear in major media outlets to slam health reform. Now that it is clear that BCBS helped write the script for the radical tenther movement, any claim that the industry supports reform must be viewed with heightened skepticism.



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Sources: NY Times, Think Progress, Huffington Post, Google Maps

Tony Rand To Resign From NC Senate...I'm Not Celebrating, Yet

Rand to resign


NC State Sen. Tony Rand, one of the most powerful political figures in the state, is leaving the Senate.

Rand, a Fayetteville Democrat, will become chairman of the state Parole Commission, Mark Johnson reports. He will resign before the end of the year.

"There comes a time when it's time to go," Rand said.

Rand has been in the Senate since 1981. He was appointed to his seat and later became rules chairman and the majority leader.

Rand, known for his wit and gravelly drawl, was the enforcer for Senate Leader Marc Basnight and made sure that the Senate's machinery ran smoothly. On the Senate floor, he is known for delivering pointed, but often entertaining allegories: "It's all chicken but the beak," he once told Dome.

Gov. Bev Perdue released a statement announcing her appointment of Rand to the Parole Board.

"North Carolina is fortunate that Senator Rand decided to take this position. He, like me, cares first and foremost about protecting the public but also understands the importance of giving people a fair shot at a second chance," said Perdue. "I don’t believe I could find a better candidate in the state or country to lead this commission."





Group says Blue Cross gave big bucks


Blue Cross and Blue Shield of North Carolina donated $643,000 to state politicians from the 2000 election cycle through 2008, the election watchdog group Democracy North Carolina says.

No other company the size of Blue Cross has donated more to state politics, the organization said in a news release Tuesday. The political action committees of seven other companies, such as banks and utilities, have given more, but they are larger than Blue Cross and operate in multiple states, reports Dan Kane.

Sen. Tony Rand, the Democratic majority leader and chairman of a Senate committee on employees’ hospital and medical benefits, received $36,000 from Blue Cross, making him the top recipient, Democracy North Carolina said. The second highest recipient was Senate leader Marc Basnight, who received $35,000.

Blue Cross, the state’s largest health insurer, administers the health insurance plan for state employees. The health plan is supervised by a legislative body.

"This arrangement puts legislative leaders in the awkward position of monitoring themselves," Democracy North Carolina said in a news release Tuesday. "When substantial political money flows from insurers to legislators, the awkward position becomes more problematic to a skeptical public, even when legislators are doing their best to protect the public interest."

Executives from Blue Cross contributed an additional $117,000 to state politicians during the same 2000-08 period, the organization said. Blue Cross' chief executive officer, Robert J. Greczyn Jr., donated $69,000, and chief operating officer J. Bradley Wilson gave $21,933.

The top recipients of donations from the executives were Basnight, Attorney General Roy Cooper and Gov. Beverly Perdue.

Democracy North Carolina said that while the plan is in trouble, Blue Cross has a reserve fund in excess of $1.2 billion and gave its top six executives $10.5 million in salaries and bonuses in 2008.

Blue Cross spokesman Lew Borman said the company is required by law to have a reserve fund representing three to six months worth of claims and administrative expenses to make sure Blue Cross can pay its customers' medical bills. He said the $1.2 billion represents "the lower end of that requirement."

He also said that the executive compensation cited was for 2005-08, which were "three of the most successful years in our company's history in terms of customer growth, and financial stability."

As for the political contributions, Borman said it's nothing out of the ordinary for employees to voluntarily contribute so that they have a "voice in the democratic process."



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Sources: McClatchy Newspapers, Under The Dome, Fayobserver, NCGA, Democracy Watchdog, News & Observer, Google Maps

Is NC's BCBS CEO Opposed To The Federal Government's Role In Health Care Reform?

Charlotte Observer----

From Bob Greczyn, CEO of Blue Cross and Blue Shield of North Carolina:

There's been talk recently that Blue Cross and Blue Shield of North Carolina is trying to stop health care reform. The talk started when some draft video concepts were taken without authorization and made their way to the Washington Post. The fact is, those draft video concepts weren't about opposition to health care reform; they were about our concerns related to government-run health insurance. We make no excuses about our concerns.

Let's be clear: Blue Cross and Blue Shield of North Carolina supports Health Care Reform and covering everyone. We are convinced a continuation of current trends would be bad for our nation, our customers, and yes, our business. Rising health care costs already threaten our customers' ability to buy health insurance.

We see three main strategies for effective reform: improving the quality and effectiveness of care, promoting preventive care and lifestyle changes and updating the reimbursement system to reward better care, not just more care.

We do not believe that government-run health insurance is necessary to achieve these goals. We are concerned that a government plan would attack costs largely by paying doctors and hospitals low fees that shift costs to private payers, as is already the case with Medicare and Medicaid. In fact, a large N.C. hospital system reports $227 million in uncompensated care based largely on low payment by Medicare and Medicaid.

Government needs to play an important role – to assist Americans who cannot afford private health insurance. We also believe the government should support and encourage the kind of private sector innovations for which Blue Cross and Blue Shield of North Carolina is already recognized as a national leader.

This country is at the beginning of a serious discussion about health care that will determine how Americans receive care. The stakes are high. Working together, we can achieve President Obama's goals for health care reform.


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Sources: Charlotte Observer, Washington Post, Think Progress, Whitehouse.gov, Wikipedia, Google Maps

Is North Carolina Pres. Obama's Nemesis To Health Care Reform?.... Planned Attack Ads

Washington Post----

One week after the nation's health insurance lobby pledged to President Obama to do what it can to constrain rising health costs, Blue Cross Blue Shield of North Carolina is putting the finishing touches on a public message campaign aimed at killing a key plank in Obama's reform platform.

As part of what it calls an "informational website," the company has hired an outside PR company to make a series of videos sounding the alarm about a government-sponsored health insurance option, known as the public plan. Obama has consistently maintained that a government-run plan, absent high-paid executives and the need for profits, could be a more affordable option for Americans who have trouble purchasing private insurance. The industry argues that creating a public insurance program will undermine the marketplace and eventually lead to a single-payer style system.

In three 30-second videos, the insurer paints a picture of a future system in which patients wait months for appointments and can't choose their own doctors, according to storyboards of the videos obtained by the Washington Post.

One video titled "Waiting" shows a receptionist fielding a request from a patient enrolled in the new program.

"The government plan. Okay hold on...let me see what's available," the woman says into the telephone. On the screen, with the caller on hold, the receptionist rearranges items on her desk, looks at a wide- open calendar and then fibs: "It looks like the first time we can fit you in is in two-and-a-half months."

Another spot in the series, being developed by Capstrat media in Raleigh, shows a woman and child wandering down a darkened hospital doorway "as if they're starting to realize that they've lost their way," according to sketches of the video. "We can do a lot better than a government-run health care system," the narrator concludes.

Blue Cross Blue Shield spokesman Lew Borman said the videos are still in the draft stage. On the question of creating a public option to compete with private insurers, he said: "We believe an unchecked government-run plan would lower payment to doctors and hospitals, forcing them to attempt to charge private insurers more and thus further eliminate private insurers' ability to compete against the government."

On its Web site, Capstrat touts its "agility in turning complex issues into simple, powerful and persuasive stories." Company president Karen Albritton declined to comment.

Blue Cross Blue Shield of North Carolina has 3.7 million members and processed more than $10.7 billion in medical claims last year. Get a first look at the video storyboards here.


Think Progress----


Blue Cross/Blue Shield of North Carolina’s (BCBSNC) ads that attack the public health plan as a mechanism for rationing health care are criticizing an idea, not a specific proposal. Recall that Democrats argue that a new public option should compete with private insurers for beneficiaries, but they have yet to agree on what that plan should look like. Some Democrats maintain that a new public health plan could be modeled on the experiences of state governments that currently offer their employees a choice between traditional private health insurance and a self-insured plan administered by the state.

Thus, given the company’s role in administrating the State Employee Plan in North Carolina, their ad seems all the more perplexing: BCBSNC may be attacking the very same kind of model that it now administers.

BCBSNC’s behavior has led to disaster in North Carolina. Recently, the State Health Plan “came in $137.6 million off its budget for fiscal year 2008, resulting in a $79.7 million loss.” Part of the problem was that BCBSNC’s administrative “expenses cost $200.1 million more than planned.” Its administrative expenses “have never been audited“:

The plan also underestimated administrative expenses by $36.3 million due to the fact that the consultant hired to forecast expenses did not have access to Blue Cross and Blue Shield of North Carolina’s costs to accurately predict expenses… The auditor’s report places much of the blame for the administrative expense overruns on the failure of State Health Plan officials to draft a reasonable contract with BCBSNC. The current contract does not specify what costs BCBSNC is able to charge to the plan and provides no incentives for BCBSNC to keep its costs down. In fact, according to the audit, it does the exact opposite. The plan agrees to pay BCBSNC its costs – plus a percentage of the insurer’s costs to provide a profit margin. Such a setup, however, means that BCBSNC makes more as the state’s costs rise. The audit report notes that the federal government stopped using such contracts in 1941.

Now, the North Carolina legislature is considering a “major fix” to the State Health Plan “that will cost taxpayers roughly $710 million, reduce benefits for state employees and teachers.” State employees would have to pay an average of more than “$600 per person over the next two years” and all premiums “would increase by 10 percent in each of the next two fiscal years.”

BCBSNC behavior suggests that reforms should be weary of using state-run plans as a model for the new public option (third-party private administrators dont’ have a record of lowering health care spending). But more importantly, BCBSNC’s attacks against health reform suggest that the company is afraid of being held to account.


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Sources: Washington Post, BCBS, Huffington Post, Think Progress, Day Life, Google Maps