Fearing that health insurance premiums may shoot up in the next few years, Senate Democrats laid a foundation on Tuesday for federal regulation of rates, four weeks after President Obama signed a law intended to rein in soaring health costs.
After a hearing on the issue, the chairman of the Senate health committee, Tom Harkin, Democrat of Iowa, said he intended to move this year on legislation that would “provide an important check on unjustified premiums.”
Mr. Harkin praised a bill introduced by Senator Dianne Feinstein, Democrat of California, that would give the secretary of health and human services the power to review premiums and block “any rate increase found to be unreasonable.” Under the bill, the federal government could regulate rates in states where state officials did not have “sufficient authority and capability” to do so.
That's right. The original ObamaCare bill that was sold on the premise that it would hold down premiums neglected to include the very mechanism(s) to hold down those premiums.
Fear not, though... help is on the way. The Secretary of health and human services will play judge, jury and executioner with respect to accepting/rejecting premium increases. Again... picking winners and losers! Corporatism and crony capitalism at its finest.
And dig this:
Reviving the proposal on Tuesday, Mr. Harkin said: “Rate review authority is needed to protect consumers from insurance companies’ jacking up premiums simply because they can. Protections must be in place to ensure that companies do not take advantage of current market conditions before health reform fundamentally changes the way they do business in 2014.”
“Currently,” Mr. Harkin said, “about 22 states in the individual market and 27 states in the small group market do not require a review of premiums before they go into effect — and perhaps even more. This is a gaping hole in our regulatory system, and it is unacceptable.”
Where to begin? First, let's just start with the understanding that Harkin is an economic ignoramous and shameless opportunist of the highest order. Good - got that out of the way.
"...jacking up premiums simply because they can.." We fail to see what is inherently wrong with that. In a free market, that "jacking up" comes with consequences... unless it doesn't. In a free market, the consumer (otherwise known as "the individual") will make the decision on whether or not that "jacking up" is acceptable or not based upon the service he is being provided.
Unfortunately, the healthcare industry is currently operating in a free market gray area where mandates and regulations drive up premiums and stifle competition, thus restricting the ability of the consumer to best respond in his own self-interest.
Under ObamaCare, the mandates and regulations only get worse thus creating the situation where premiums are expected to rise in the next few years as stated at the very top of this article. This is known as "price signaling" where healthcare insurers knowing they will be getting slammed by increased regulatory burdens (such as covering pre-existing conditions) will get out ahead of the curve and start, you know, jacking up premiums to cover those additional future expenditures.
The ObamaCare acolytes know this and are scrambling to prevent the inevitable from happening. What will result though is a tightening of the grip on the health insurance industry to where health insurance providers no longer feel it's profitable (yes, we referenced "profit") to stay in the business any longer thus reducing the competitive market and choices even further.
Sounds like a game plan for driving this bus towards the single payer/public option model, now doesn't it?
Perhaps Harkin and his Capitol Hill kin aren't as clueless as we suspected.