With the passage of the Senate Finance Committee’s version of health care reform, the war has commenced between the health insurance industry and the 300 million Americans who are insured by and through them. The first salvo of this conflict was when, 24 hours before the 14-9 vote by members of the Senate Finance Committee to pass its bill, insurers flooded the airwaves with propaganda that health care reform will increase premiums to a significant extent. What those very same entities don’t say is that this industry makes ghastly profits, and that any new reforms will only reduce these profits to some reasonable level.
To readers of this blog, let’s be clear: there must be a strong enough option to compete with insurance companies in the private sector so that consumers have four things: to be able to access health care; to be able to afford health care; to have choice in what option to select based on family or personal circumstances; and to have competition. Competition is the American way. The public option, as the popular moniker for this option, fulfills the American way here. (The opposite of competition is monopolization, which the insurance industry has because it has been exempted from the antitrust laws since 1945 (Senator Leahy introduced a couple of weeks ago a bill to eliminate this exemption, and we should all be for it)).
Next, all consumers must realize that new insurance regulations – - – like no pre-existing condition will bar coverage; like there will be a cap on out-of-pocket expenses; like there will be no ceiling for covered claims; and like an insurer will not be able to rescind coverage absent fraud for treatment already rendered – - – will decrease the health industry’s record level of profits. The only way to increase revenues is to . . . increase premiums. But we are hearing from the insurance lobby that premiums will have to increase not because of the new regulations, but because not enough individuals will be insured under the mandate within the Senate Finance Committee bill, and that the penalties for not becoming insured are not high enough. With a public option in place, premiums will stay in check or more likely be reduced considerably all across the board. The public option is the nemesis of the insurance industry, but this option is a savior for every single American seeking to maintain health. Without it, the “raping” of Americans by the insurance industry will continue to occur. To be sure the major insurers will do everything they can to compete effectively with the public option. So, let’s not have a tag day for insurers with a public option in place. Insurers will do just fine, and they know it!
But to make a public option a reality, we need to deluge our elected representatives daily with emails, letters, faxes and phone calls, saying what we want. Co-ops won’t do it (they have no strength to bargain); a trigger to a public option won’t do it because the insurance lobby will never allow conditions to occur that would set it (trigger) off; adopting a public option and then give states the ability to opt-out is ill advised as well because state elected officials will not have as much strength to stand up to the insurance industry lobby as does the federal government.
One other point. Any health care reform must provide a mechanism to bar the insurance industry from hiking rates before the effective date of the legislation. Recall what the credit card companies did in the last year before new federal regulations went into effect regarding interest rates? We will be fools if we allow a repeat of this.
In the end, the moral imperative to health care reform is that health care is either a right for every single American, or at least a service (like electricity or water or the municipal bus on which we ride to work). Keep this in mind when someone says that we should not have a public option.