House Speaker Nancy Pelosi warned insurance companies on Thursday that health-care reform could cost the industry dearly through new fees, fewer regulatory protections and fresh competition from the federal government.
The blunt admonition echoed a round of harsh statements Wednesday from senior Senate Democrats, and came in response to the insurance’s lobby’s aggressive campaign to block reform legislation from advancing. An internal industry study released earlier this week found that the Senate reform bill would cause premiums to rise sharply, but the report’s findings have been widely disputed.
The tactic now appears to have backfired, as Democrats vow to redouble their efforts to crack down on insurer’s practices. Health-care negotiators are working behind closed doors to merge different pieces of legislation into separate bills that are expected to reach the House and Senate floors next month.
“It is absolutely clear that it is an unsustainable situation as we go forward, and it is well known to the public that the health insurance companies are the problem,” said Pelosi.
Pelosi said the House may adopt a Senate provision that would assess a flat fee on insurance companies that is expected to generate about $40 billion over 10 years, as a way to pay for its reform bill. She advocated House language that would require health-insurance companies to to spend 85 cents of every dollar they collect in premiums on benefits.
The insurance companies dug their own grave with their arrogant reversal on what they promised Obama. Not unlike what they do to their clients daily. Time to take their own medicine?
1
Support the Blog — Buy This Book!
For Kindle and with free ePub version. Only $9.49 Great reading.
Here is what Gary Shapiro CEO of the Consumer Electronics Association (CEA) said: Dvorak's writing sings with insight and clarity. Whether or not you agree with John's views, he will get you thinking and is never boring. These essays are worth the read!
Put this ad on your blog!
Syndicate
Subscribe to Main Blog feed here:
Subscribe to Comments too (below):
Junk Email Filter
The Federal government may turn out to have a bigger dick than the insurance companies after all.
BFD. In all things political, a pat on the back usually involves a knife at some point.
They are still going to jail people for not buying health insurance. And before I get a heaping helping of “wait, there are only fines…the bill doesn’t say jail time.” The fines will be handed out by the IRS. What happens when you don’t pay a fine levied by the IRS? That’s right…people with badges and guns come grab you and put you in a cage.
One more thing…this isn’t just like the laws requiring car insurance. At least with car insurance you have the option of taking the bus if you don’t want to buy a policy.
Seeing as only universal health care will stop the industry-government hedonistic money swap, I’ll believe it when I see it.
It’s nice to believe though that everyone involved and not just a few really care about the U.S. citizens’ health, which I believe should be a constitutional guarantee that hasn’t been codified.
Pots meet kettles.
The insurance companies serve no useful purpose in healthcare. They are parasites, taking large cuts of $$, perverting our legislative processes, and killing people in the process. I think that if insurance is mandated by the government, then there should be a government insurance choice. P.S. If feel this way about car insurance, too.
This is so wrong. The problem with health insurance now is government regulation. Why isn’t health insurance competitive like life insurance, car insurance, identity theft insurance? Because of government involvement. And now Pelosi says that it will cost the insurance companies more?? No, it will cost consumers more, because unlike the government, companies that don’t make a profit fold, and again (unlike government) private businesses are the ones who provide jobs, pay taxes, and grow the economy.
Why do people think businesses which are the foundation of capitalism are the enemies? Because government has to blame someone for the unintended consequences of centuries of anti-capitalist mistakes.
#6 Number 6 for the win!
My biggest beef with this whole healthcare process is congress has it in its head that it can do things better.
The people that say ‘capitalism doesn’t work’ don’t know how to ‘work the system of capitalism’ This is solveable and good market forces could do it.
People who don’t trust Obama, do you trust Pelosi???
#7: It may, in the end, not be able to do better, but it sure can’t do any worse. We may have the best health care in the world, but short of those with none at all, we have the worst health care delivery system in the world.
#6–softie and #7–stinker==idiots. There is no place on earth where for profit medicine works, the USA is the only first world country with it and it is bankrupting us, and they want to continue under the current “We’re Sinking, The Titanic” Program. Pure Dolts. Can’t wait for LIEBERTARIAN to chime in with his agreement with THEM.
On an all too similar note, the new Banking Reform Bill actually is worse than no law at all/current status quo as at least now what has occurred “COULD BE” prosecuted under various fraud theories===BUT NO==pro business scam interests like dolt and idjit above have draft language that would actually legalize much of what brought the world to the edge of collapse. Our Congress as become co-conspirators with fraudulent corporate hucksters.
VOTE ALL INCUMBENTS OUT OF OFFICE.
The insurance companies only brought out this report when the individual mandate was reduced and reduced and then finally dropped. Nobody who even has a shred of intellect can deny that if you require insurance companies to cover everybody, regardless of pre-existing condition, that they MUST raise prices dramatically to stay in business. How else are they going to have the money to cover someone that never pays into the system and then comes down with a condition that costs $20,000 to treat, but the patient only has to pay in a couple thousand bucks because insurers must cover them.
#6 – srgotsoft
Your defense of capitalism is fine, but in this case we are talking about taking care of people, not cars or houses. There is a difference, a deeply moral difference.
Health insurance is one of the MOST deregulated industries, and that is the core of the problem. They treat people like objects, like numbered cattle, not like people. They are in the business of maximizing profits while minimizing expenses, which means providing as little care as possible for the highest rates possible, denying care whenever possible and ‘culling’ those deemed not fit for their herd.
You may enjoy being treated like a cow, but we are better than that.
The study raising ‘Libertarian’ noise actually shows that in order to maintain the SAME huge profits, private insurance would have to raise their rates. It is not about costs and quality, it’s about maintaining profit numbers.
The FACT is that the USA ranks something like 37th in quality of healthcare, while ranking #1 in cost of healthcare. That just shows you that capitalism, as being applied by the health insurance industry, is not a reality. It is just a profit machine.
Like I said, if you like being part of a herd of cattle, fine, just sit there and chew your cud of health industry lies… but some of us like being treated, and treating others, like humans.
So there are legislative proposals to not allow insurers to decline coverage to new customers based on preexisting conditions, and to not allow different premium prices to be charged based on an individual’s risk level from diet, lifestyle, etc., and these politicians don’t think that insurance premiums will go up across the board as a consequence? Have these people never even heard of the concept of adverse selection?
This is yet another example of the totalitarian nature on the left. If you disagree with their policies they will molest you until you either go out of business or get back in line with their program. The left enforces maximum compliance, or they will attempt to put you out of a living.
For-profit health care works great at delivering profit into the pockets of the big insurers. It works terrible at delivering health care to Americans. It’s been repeated over and over — we’re way up there in cost, way down there in actual health care delivered.
For. Profit. Medicine. Doesn’t. Work.
I was always of the opinion that if a business is not doing something right or not giving their consumers what they need someone else would start up a business that would meet that demand.
Someone out there must be able to make a better business if that is the problem with the healthcare system. When they do these big businesses will be out matched and will have to adjust fire if they want to stay in the game or fold.
Dont like the services provided to you? Make a system that is better. Why is it that people feel that it is the government that needs to make this happen.
What I dont like about the Government is that even if this system that is created fails horribly for whatever reason we will continue to poor money into it until we run out.
@#9 It is not bankrupting us. Just the part of the health care run by Government. 80+% of us have properly working and satisfactory health insurance, better than any place in the word where some of us came from. Rest? Eliminate Govt. completely from the process and leave it to charity organizations (funded by the same wealthy who Govt. wants to tax). Though, some of those wealthy like Soros like more the political influence they get for political contributions than to help people directly as they claim they like to do.
Problem in US is that people do not have direct experience with “socialized medicine” and with blinders on see just possible positive aspects, not realizing that the whole concept is utopian and run on the backs of the weakest in the society. I personally lost both mother and father way too early in their old age (ie. if they were on insurance companies tab in US, they’ll likely still be alive) to “free medicine for all” schemes which very few economies in the world could really support (extremely naturally wealthy with low population and population density, ex. Norway, Dubai,…). The rest pretend to cover everyone but must cut cost on weakest (ex. recent British ban on cancer medicine that could extend life but it costs about 50000$ per six months).
I prefer brutal honesty of insurance company and cutting edge medical system vs. knife in the back and “everything is perfect, move along” world of govt. health care with mediocre medical system.
#16 In other words, do it exactly the opposite way from all the other countries that have successful systems that deliver health care to all of their citizens at a reasonable cost.
Libertarians… sheesh.
What you status quo dolts fail to appreciate is that “medicine” and “healthcare” are not proper activities to be regulated by the free market system==as the US failed system demonstrates in spades. Being of age and literate, if you haven’t figured out that by now, nothing additional will. You’ll change your mind when your personal experiences open your eyes to the truth that current statistics overwhelmingly proving this point are failing to do so far.
#18 Good point bobbo. In a for-profit system, your premiums will go up every year. Even if absolutely nothing changed in your health insurance plan, you’d still pay more. Why? Because the for-profit health insurance companies must make a bigger profit every year — Wall Street demands it.
THe insurance companies should have known that deals made with Obama wouldn’t last. The drug companies found this out too, as Congress is refusing to honor their deal of 80 billion.
Did the insurance guys really think they could make a deal with people tat want to put them out of business? They tried to strike a deal where they have everyone as their customer, managed by the government. Kind of like the fascists of lore.
Seems very clever to me…
#19–phydeau==thank you. Sad to see intelligent people thinking “the market” will step in and a for profit enterprise will compete based on lower prices to the consumer AS IF THAT HAS EVER HAPPENED ONCE === when as in healthcare the anti-monopoly rules have specifically exempted insurance companies. Why would you go into business to make “less money” when the law says you can talk to and agree with your competitors to charge the same and both look good to your “investors?”
But lies build up from there by industry shills claiming that the MediCare 4% overhead is less efficient than the insurance co’s with their 30-40 % overhead. Yes, even math fails to establish the truth when shills can make money at it otherwise==as long as congress can be bought off and not lose their offices, this fraud/stupidity will continue.
VOTE ALL INCUMBENTS OUT OF OFFICE, and all status quo conspirators into jail.
I’m still banking on the insurance companies to win.
Remember, we’re talking about a $500,000,000,000 PER YEAR being skimmed off the delivery of health care.
Just a lousy billion dollars ( 1/500th) of that can line the pockets of MANY MANY republicans.
The insurance company motto:
You CAN fool all the people all the time if you have a big enough advertising (lobbying) budget.
So the Democrats are admitting that Insurance companies won’t be able to compete with the Government plan because of new regulations and laws (and not because the Government will run things more efficiently).
So much for having a choice of keeping your current insurer. Instead, your insurer will quit you, probably by getting out of the “main” health insurance business and providing “supplementary” insurance to cover all the things the government won’t pay for.
What the people that want a government run system don’t understand is that this will not only destroy the insurance industry (which they admit they want to do) but also the biotech industry, which is the engine of drug/therapeutics development in the world.
Venture capitalists will see what Pelosi and Co are all about and small biotechs will simply not go forward. Who in their right mind will invest in drug development when at the end of the process the democrats will deem them greedy and break their patent, or refuse to pay for the R&D? So then it will be up to government to develop new drug technologies, test them, manufacture them, bring them to market, market them, and support the drugs with the doctors.
And the government will do this for 300,000,000 people, when we know (and they are happy to admit this) that their current system that covers 100,000,000 in medicare is bankrupt? When has government ever shown it is capable of doing this? The “stellar” examples of how the system is working in Europe are hemorrhaging their biotech companies and people to the US where they can actually make a living. Do those that want to take over health care even talk about this? Of course not because they don’t care, they just want the power. docstoc.com/docs/1952835/How-To-Plug-Europes-Brain-Drain
The point about letting the left take on these things is that they will slowly put you and your economy out of business one sector at a time, until they control everything. It’s just what they do, and if you don’t like it, they will put you out of business too.
#1, FINALLY..
—-
“require health-insurance companies to to spend 85 cents of every dollar they collect in premiums on benefits.”
Lets see. 15% of 65 billion?? still not a bad pay check.
—-
#5
this is middle man syndrome.
where the GUY in the middle gets all the money. This was setup about 30 years ago, when it was decided that the CONSUMER was not supposed to buy DIRECT from a maker. It was figured tha it would make more jobs and make things cheaper with a TIER’D system..
First group buy in 1000’s
2nd can buy in 100’s
Third group in 1-10..
Then you the consumer get to buy something.
Now look up SRP. and try to figure out how they came up with that number.
—-
#6,
And what happens when all the health organizations DONT compete? when they are all owned by 4 people and they are ALL friends.
Insurance is no better then ANY corp. For those on top to make money, they FIRE those below and over work the ones left. AFTER that they start cutting corner and benefits..
—-
#7,
you want to make it work? Then regulate it so that 1 person can only RUN/own 1 company.
Look up GE and all its subsidiary..
—-
most of the problems in medical come with FEW regulations, and the cost of goods.
The medical community is SELF regulated like lawyers.
And costs are STUPID. The machines used cost so much that it takes YEARS to pay off 1 machine.
Then add to that a doctor that thinks that operating on 1 person should PAY him for the month??
Then lets look at LAND costs and Medical insurance..WOW.
TAKe all that away, and things get cheap.
#15 “I was always of the opinion that if a business is not doing something right or not giving their consumers what they need someone else would start up a business that would meet that demand.”
In order to start an insurnace company (doesn’t matter what type) one needs large amounts of money to back it. Much more than any small business breaking into any other established market.
You can’t start a Blue Cross in your basement (unless you are Bill Gates) because the amount of cash-on-hand or cash-on-demand (e.g. fast credit lines) is too high of a bar for “garage based business”. Thus it is hard for “someone to do it better,” since any idea to improve it can’t be as grass roots as other sectors. Thus limiting any improvements from happening outside of pre-existing insurance companies to drive the costs down.
With that stated what is occuring is companies appearing trying to figure out semi-cheap (and preferible subscription style) ways of selling “better health” to people so they can avoid using insurance, and I’m not sure that is always a good thing.
– Ben
Back in the 50s through the 70s, in the city where I lived as a kid, the three biggest hospitals in town were not-for-profit organizations. They provided the best health care in that city. The smaller for-profit hospitals didn’t do so well because they were too expensive. The not for profits were eventually bought up by for-profits, and fees went up and quality went down (bottom line was more important). Need I say more?
What’s the old saying. If it takes too much coaxing to get done. Then maybe it should not be done? It seems as though the Democrats are on some sort of god like mission. In fact this is much like the stimulus that was passed without pause. As one put it when that was done. Nothing good comes from government when its done in a hurry. Why so much haste in getting the health care past? What is the hurry? I think something if its going to be done should at least be heard from all sides and debated on.