The Health Insurance Industry Report

When the health insurance executives met with President Obama earlier this year to assure him that they were going to take steps to lower health care costs, I warned that they were lying. Shortly after the meeting, they backed-out of their commitments and began preparing television ads attacking health care reform. Now they have come-out with a report prepared by flunkies which claims that health care reform as envisioned by the Senate Finance Committee bill will actually raise premiums for most Americans. Richard Kirsch of Health Care for America Now responded to the report, saying: "The idea that the insurance industry would complain about high premiums is like the Yankees complaining that they're hitting too many home runs. It's totally preposterous."

Senate Finance Committee spokesman Scott Mulhauser called the report "a health insurance company hatchet job -- plain and simple." The report has been ripped to shreds by experts. It deliberately ignores all of the provisions of the bill that will bring large savings to health care recipients. It ignores the proposed subsidies that would help millions of people to buy their own insurance. Jonathan Gruber, professor of economics at the Massachusetts Institute of Technology and director of the health care program at the National Bureau of Economic Research, says that the Finance Committee plan will not raise premiums but will substantially lower the cost of health insurance.

The obvious purpose of the report is for the insurance industry to make a nasty threat to raise premiums if Congress reduces Medicare payments to hospitals and compels insurance companies to cover people who are ill or who have prior medical conditions. The answer to such a threat is to enact a public option.

The behavior of the health insurance industry during this fight over reform has been an example of American business at its most reprehensible. It is worse even than the behavior of the oil, pharmaceutical, and other miscreant industries. I previously quoted the figure of 18,000 people who die each year due to lack of health insurance. Now, because of the policies of the health insurance industry, the figure for those who die each year because of lack of health insurance has risen to 45,000. That is a national disgrace. The argument is no longer political. It is moral.

Wendell Potter, a former insurance company executive turned whistle-blower, said the report is aimed to shape reform "for their (insurance companies’) benefit and the benefit of Wall Street shareholders, more than Americans. This is a desperation move on the part of the insurance industry, because analysts are now somewhat concerned ... that the bill may not be absolutely everything that the industry wants”

The bill passed by the Senate Finance Committee is designed to lower, not raise, health insurance premiums. Moreover, the Congressional Budget Office analysis shows that the bill will reduce the national deficit by more than $80 billion over the next decade, provide insurance to an additional 29 million people, and extend coverage to 94 percent of the country's non-elderly population.

The Senate Finance Committee bill is highly imperfect. It does not contain a public option. It weakens the mandate that individuals carry health insurance. That is not the end of the matter, however. That bill is likely to be combined with a bill that does have a public option. The individual mandate will probably be strengthened in a combined bill. If the public option is not in the final Senate bill, it will be in the final bill coming out of the Senate-House Conference. It will then be voted on by both the Senate and the House. If the Senate Republicans filibuster the final vote, the Democrats have the option of treating the legislation as budget reconciliation legislation requiring only 51 votes for passage.