Monday, December 20, 2010

"Please save us from your consumer protections"

The CATO Institute has a nice little round-up of the market-distorting effects of ObamaCare in the 5-minute podcast below and which many of the concepts hit on have been discussion points at this blog as well.

The 2nd half of the video zeroes in on developments with respect to child-only insurance and how the insurance companies were going to handle pre-existing conditions that we were heretofore unaware.

(if embed no worky, please go here)

We were not aware of this letter sent from Sebelius to health insurers offering a waiver of price controls for children with pre-existing conditions so that the health insurers could charge these particular children more. Note the podcast claims that they weren't even sure if Sebelius could do this under the law but that she did it anyway.

We did a search and the following is what we came up with from this past October. As we read the news story a recurring theme kept coming back to us: no one knows what the hell is going on.

The Obama administration, aiming to encourage health insurance companies to offer child-only policies, said Wednesday that they could charge higher premiums for coverage of children with serious medical problems, if state law allowed it.

Earlier this year, major insurers, faced with an unprofitable business, stopped issuing new child-only policies. They said that the Obama administration’s interpretation of the new health care law would allow families to buy such coverage at the last minute, when children became ill and were headed to the hospital.

In September, the administration said that insurers could establish open-enrollment periods — for example, one month a year — during which they would accept all children.

Now, on Wednesday, the administration, answering a question raised by many insurers, said they could charge higher premiums to sick children outside the open-enrollment period, if state laws allowed such underwriting, as many do.

Insurers “can adjust their rates based on health status until 2014, to the extent state law allows,” said Jay Angoff, director of the Office of Consumer Information and Insurance Oversight at the Department of Health and Human Services.

The difficulty in preserving access to child-only insurance policies is the latest example of unintended consequences of the new law, the Patient Protection and Affordable Care Act. The problem may be solved in 2014. If Democrats can beat back Republican efforts to dismantle the law, most Americans will be required to carry health insurance, starting in 2014, and insurers will be required to accept all applicants, regardless of pre-existing conditions.

The new policy statement, issued Wednesday by Kathleen Sebelius, the secretary of health and human services, came with a fresh blast of criticism of the insurance industry.

“Unfortunately,” Ms. Sebelius said, “some insurers have decided to stop writing new business in the child-only insurance market, reneging on a previous commitment made in a March letter to ‘make pre-existing condition exclusions a thing of the past.’ ”

The White House has been tussling with insurers for months, trying to get them to provide coverage for children with cancer, autism, heart defects and other conditions.

In a letter Wednesday to the National Association of Insurance Commissioners, Ms. Sebelius said the decision of some insurers to stop issuing child-only policies was “extremely disappointing.”

But Ms. Sebelius acknowledged, “Nothing in the Affordable Care Act, or any other existing federal law, allows us to require insurance companies to offer a particular type of policy at this time.”

Insurance industry lobbyists say Ms. Sebelius mischaracterized their commitment. They denied that they had promised to continue offering child-only policies.

In a series of questions and answers intended to clarify its reading of the law, the administration said Wednesday that insurers had two options. They can enroll all children year-round, or decline to enroll all children outside the open-enrollment period.

... and on it goes.

Again, what sort of warm and fuzzy are you getting that anyone has a firm handle on precisely how this law is going to be implemented? Neither do we because at this point it's all being negotiated. The government is not governing, it's haggling. In between rounds of granting waivers, that thug Sebelius will saber-rattle, threaten and cajole before offering up another round of waivers, relaxations, open enrollment periods and out clauses. Sorry, this isn't our idea of a constitutional republic rather one more of the banana variety.

As KT reminded us, when the government can at once force an economic activity on you while simultaneously granting exceptions and waivers, the resultant arbitrariness and uncertainty is an invitation to disaster.


steve said...

I have always taken care of a lot of kids. Over the last few years I have seen a steady increase in the number of kids coming to the OR whose care was delayed due to a lack of insurance. What should have been simple procedures become difficult and risky. The INTENDED consequence of repealing the ACA, will mean that I get to see more of these kids.

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Dean said...

As will maintaining ObamaCare. Let's truly reform healthcare instead of increasing the bureaucracy.

K T Cat said...

First off, thanks for the link! As for the rest, the accretion of regulations is amazing. It's like we're in late-stage arterial sclerosis as a nation.

steve said...

"s will maintaining ObamaCare."

Nope. It may be weak on cost controls, but it does provide for much more access.

" Let's truly reform healthcare instead of increasing the bureaucracy."

I read and write a bit on healthcare as well as practice it. I have yet to see any health reform efforts from the right/conservatives/whatever other than when opposing those of the left. I dont believe that any alternatives will be forthcoming if the ACA is repealed.


Dean said...

If health providers are either dropping coverage or are being granted waivers to (wait for it)... not provide increased access, how is that increasing access?

I agree. There has been a total lack of political will on the right to reform the health care system. However, that does not mean there are not some good ideas out there to help do it. But ObamaCare ain't one of them.

B-Daddy said...

Paul Ryan introduced the the Patient Choice Act and John Mackey outlined an alternate approach as well. There are plenty of approaches that would work that don't require the bureaucracy we have.

The real problem is third party payer for health services, disconnecting the delivery from paying, weakening accountability.

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