Robert Reich: Time to call health-care insurers' bluff

[babylonsister]

http://www.suntimes.com/news/otherviews/1823142,CST-EDT-open14.article

Time to call health-care insurers' bluff
October 14, 2009
BY ROBERT REICH



The health insurance industry has finally revealed itself for what it is.

Background: The industry hates the idea that has emerged from the Senate Finance Committee of lowering penalties on younger and healthier people who don't buy insurance. Relying on an analysis by PricewaterhouseCoopers, insurers say this means new enrollees will be older and less healthy -- which will drive up costs. And, says the industry, these costs will be passed on to consumers in the form of higher premiums.

Proposed taxes on high-priced "Cadillac" policies also will be passed to consumers. As a result, premiums will rise faster and higher than the government projects.

It's an 11th-hour bombshell.

But the bomb went off under the insurers. The only reason these costs can be passed on to consumers in the form of higher premiums is because there's not enough competition among private insurers to force them to absorb the costs by becoming more efficient.

Get it? Health insurers have just made the best argument yet about why a public insurance option is necessary.

snip//

Now's the time for Senate Finance Committee and the White House to say to the insurance industry: You want to play hardball? OK. We'll play it, too.

You didn't want a public insurance option. That was one of your conditions for supporting the bill. You wanted gigantic profits from having 30 million new paying customers and the market to yourself.

We agreed because we wanted your support and were afraid of the negative ads and hurricane of opposition you could finance. But you're even greedier than we imagined.

And now you've demonstrated that greed to the American people. They don't want to turn over even more of their hard-earned money to you. So, insurance companies, we've got news for you. We're going to make sure Americans have the freedom to choose a public insurance option that's cheaper and better, and you're going to have to work hard to keep them as your customers.

[FiveGoodMen]

1. Yes it is!