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?

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.

  1. jescott418 says:

    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.

  2. mikeoliphant says:

    I am a health insurance agent in Utah and run two websites that sell insurance and I mention this because in Utah it would be great to have a guaranteed public option to put people that the private insurers will decline for health conditions. Plus the way Weiner discribes the public option, it will be priced competitively. So what this means in my industry (I’ve been at it 18 years) is that all my unhealthy clients that get charged more or declined can be put onto the public option now. All my healthy clients can stay on the private option. Hmmmmm follow me yet???? How long can the public option stay affordable?? Who is going to pay for the losses of a big sick pool of people….taxpayers?????

  3. DaTruth says:

    The biggest myth going around is that somehow a “public option” will create a “level playing field”. Assuming that people who visit this website are somewhat logical (key word “somewhat”), let’s put this to a hypothetical test.

    Company A is “for profit”. It now has competition from Government B, a non-profit.

    Both Company A and Government B have squeezed every conceivable bit of efficiency possible out of their respective systems, and are now matching core costs for health services.

    Problem: Company A needs to tack on a profit margin to stay in business. Government B doesn’t need to.

    Outcome: Consumers, not being stupid, opt for Government B’s plan because it costs less. Company A (and all other for-profit health care companies) are forced out of business. Government B is the only player left, and we now have “Single Payer” by default.

    There’s no two ways about it. Anyone who argues otherwise is being totally disingenuous.

    Now, there will be those who argue “we shouldn’t have private for-profit health care insurance companies!” But here’s the rub: That’s not how this is being presented by Obama and the Democrats. It’s “you can keep your current insurance”. Of course, what they’re not saying is it’s going to cost you more because actual companies that don’t have the luxury of taxpayer subsidies cannot, repeat, cannot compete with the government entity. No company can, and we all know it.

    So, they’re lying, plain and simple. Plus, there are Democrats on record who are saying outright that the public option is the best stepping stone to single payer.

    So my question is, why stop at health insurance? Let’s have government “compete” with private industry everywhere. Let’s have a government airline, government cars (oops, we already have GM!), government grocery stores. You could make moral arguments for all that stuff.

  4. bobbo, the evangelical anti-theist says:

    #31–jescott==this is a democracy. The polls consistently show that above 50% of the people want single payer/universal access (sic==as in phrase it your own way)

    Under what system of government do you think the majority will should not be implemented?

    #33–Datruth==lets hope so. Way to straw man the argument though. NO ONE has ever argued lets do away with insurance co==except that they stand in the way of/interfere with constructing single payer/universal coverage. Private Pay will continue to exist in the future–at reduced levels.

    What on gods green earth makes you think “society” has an interest in making sure for profit insurance carriers have a viable business? Isn’t the real issue that all people should have actual use of decent quality healthcare???

    Does it make sense to you that some should get the best care possible while others get none? Is that your view of a just society?

  5. Phydeau says:

    #33 Which is it? At various times, opponents of health care reform have offered two totally inconsistent rationales for their opposition.

    1. Government health insurance will be so ruthlessly efficient that it will drive all private insurance companies out of business.

    2. Government health insurance will be so bloated and inefficient (the government can’t do anything right) that it won’t be any better than private insurance.

    I suppose it would be too much to ask for y’all to agree on one argument?

    So my question is, why stop at health insurance? Let’s have government “compete” with private industry everywhere. Let’s have a government airline, government cars (oops, we already have GM!), government grocery stores. You could make moral arguments for all that stuff.

    Government “competes” with private industry all the time. We have government-run police and fire departments, for example. Wherever the free-market competition model doesn’t work, government-run is better. And health care is one of those situations.

  6. The bastards claim that the industry doesn’t need the public option because they already operate in a highly competitive environment. Let’s make it so by taking away their antitrust exemption.

    I see no reason not to hit the entire insurance industry with this, even if it is just the health insurers being bastards right now.

    Until yesterday, I was not even aware that the insurance industry was exempt from The Sherman Antitrust Act.

    I’d hit ’em with that and still create a public option. If the insurers can’t compete with the government option, then we know which one’s better. If they are better, they’ll have no trouble with a little competition.

  7. #6 – srgothard,

    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.

    Are you out of your mind? What involvement? No antitrust, no rule that pre-existing conditions must be covered, no rule that you can’t drop someone when they get sick, no rules that life-sustaining treatments must be covered?

    Where is there any government involvement in health insurance?

    The only government involvement is that if you’re lucky enough to live to 65, then and only then, can you get good health insurance … provided by the government.

  8. deowll says:

    Do you guys want to know why health care is so high? Federal and state government.

    Tort reform brought the cost of insurance down in California by 40%. Howard Dean says we can’t fix that because the trial lawyers are to important to the party as in we sold out.

    Requiring insurance for non catastrophic events shoves up the cost of insurance.

    Government waste shoves up the cost of insurance.

    The government okaying price fixing among insurance companies had driven up the cost of insurance.

    Medicare and Medicaid are the poster children for waste, corruption and abuse while still not covering the full cost of many treatments with the difference being paid by everybody else! Yeah they’re going to save 500 million in waste! If they these smart people actually had a clue how to save six cents why aren’t they doing it?

    Sure the government is going to fix it health care. When you know where freezes over and the locals all go ice skating they’ll make it more efficient and cost effective.

    A few more people will get some level of coverage from the government. A lot of people are going to face much lower rates of reimbursement with most people left just wondering who rammed the hoe handle up their butts and caused them to loose their insurance.

    Get this through your heads. Incompetents can’t fix anything. just because some long legged mac daddy told you some fairy tales to get elected doesn’t mean he has a clue how to deliver. This is beyond their level of understanding and most politicians are way to bought out, corrupt, partisan, and ignorant to fix anything other than their own nest egg! They are great at that.

  9. First, they came for the insurance companies…

    What bvllsh1t!

    Aside from the fact that the federal gub’mint has NO BUSINESS in the insurance business, the only difference between private company arrogance and federal gub’mint HUBRIS is that the federal gub’mint can threaten to EXTORT money from those private companies which dare to object to gub’mint legislation.

    And Uncle Dave is OK with this fascism???


  10. tcc3 says:

    Phydeau – If they decided on an argument, they couldn’t make up a new specious counter point for every point.

  11. LibertyLover says:

    #36, You beat me to it.

    Did you notice these three little words in Pelosi’s warning? “fewer regulatory protections”

    The government has been protecting these big companies all along. I am surprised it has taken people this long to realize it.

    If we were to remove the special protections and regulations that make it hard for start ups to compete with these guys, the prices will have no option BUT to come down or they’ll go out of business.

  12. tcc3 says:

    Yes, im sure there are people just champing at the bit to “start up” a new company at the cost of billions of dollars who’s mission is to make less profit so people get adequate health care.

    I’m sure there’s big investors lining up for that too.

    This is not an appropriate use of the for profit system as it is not a fair market.

  13. freddybobs68k says:

    # 36 Misanthropic Scott

    Well that is interesting – and they should remove the exemption for sure.

    How about having employees have the option to have the same amount of money payed as salary as being paid to the health insurers? In that way it makes the amount of money the employee is losing transparent. And it means there can be more of a ‘free market’ – as it allows the money to be controlled by the employee not the company.

    Has some wrinkles if a company self insurers, but the equivalent amount could be calculated with a simple formula.

    I think a big part of the problem, is that people don’t see the amount they are losing under the current arrangement. And because most people get health insurance via their employer, its not a free market at all.

  14. Rabble Rouser says:

    Karma’s a bitch, isn’t it?
    Screw the freakin’ insurance companies. They have been screwing us for too long. They raise rates, and skim 40% off the top for their own coffers, then when you do get REALLY sick or injured, they deny you coverage, because of a “pre-existing condition.” Yeah, right, LIFE is a pre-existing condition to those bass turds. All they want is your money, and they don’t want to give you too much care, because it might interrupt their profit margin. Suck it up guys.
    I sure hope the party’s over for these parasites.

  15. MikeN says:

    Bobbo, you get less overhead if you spend less money targeting fraud, waste, and abuse.

    How is Medicare going to cut these items which everyone is promising they will without spending more money? Add 50 billion or more to the insurance companies’ payouts and take away their claims reviewers, and I’m sure their administration costs will drop too.

  16. bobbo, international pastry chef and healthcare expert says:

    #46–Mike==you getting bored? You start making stuff up when bored.

    I’m not “sure” but I think study after study shows that a dollar spent in anti-fraud activities returns more than a dollar in savings===so, you are wrong. Wrong on MediCare Overhead expenses as well as Private Ins Co. So far wrong, not worth the effort to school you. Nice try though.

    Why do you hate sick people? /// and healthy people that haven’t tried to use their insurance? /// and american exporters who are at international disadvantage having to include healthcare costs in their products? /// etc?

  17. Mr. Fusion says:

    It never ceases to amaze me that the Health Care Insurance industry likes to lie so much. And so many wing nuts fall for it and parrot the lies.

    The best, and cheapest, solution is a single payer system like Canada. Allow the present insurance companies to offer insurance for things not covered by a government run system, such as dental, drugs, supplies, financial compensation, etc.

    Don’t even waste time with a hybrid system of government / co-op / private bullshit.

    In my opinion the insurance companies have done nothing to earn any respect. They were built on their subscribers money, not shareholders money. If they were all dismantled tomorrow, I would cheer.

  18. OvenMaster says:

    If the insurance companies raise their premiums in order to pass on higher costs and still keep acceptable profit margins to please stockholders, wouldn’t that potentially mean that even more people would qualify for premium assistance from Uncle Sugar?

    In other words, we taxpayers would STILL foot the bill.

  19. ECA says:

    we ALL pay for it one way or another..
    Those that get it free(??), the insurance corp raises the prices.. JUST so the guys on top dont loose wages..

    wouldnt it be better if ALL of us, PAID into the medical benefits??

    AS it would be nice that ALL the rich pay into Social security AND if they want better retirement PAY for the retirement fund ALSO..

    When the cost of medical for a 1 week stay can HURT your check…Its a bad thing.
    When the LASt thing you want is to Loose a couple hours at work…ITS a bad thing.
    When you worry more about the cost of your kid riding a BIKE and breaking an ARM…Its a bad thing.
    When your teeth ROT out, as your company doesnt cover DENTAL…its a bad thing.
    When you loose a job, because your EYES NEED HELP, and there is no eye/glasses coverage…ITS A BAD THING.

    To give you an idea, I will say that I KNOW the cost of Glasses FRAMES, and the cost of lenses.. I can tell you that you could FIT and give EVERY PERSON in the USA a pair, for under $20 EACH and still make a VERY good profit.

  20. Uncle Patso says:

    # 39 deowll:
    Requiring insurance for non catastrophic events shoves up the cost of insurance.

    I just do not get that statement; the logic of it totally escapes me. I suppose if everybody has to buy insurance, the insurance companies will have to hire more people to administer all those new policies…

    – – – – –

    The big question I have is what happened to all the mutual insurance companies? (Ones owned by their policyholders, not shareholders.) Also, who decided it was a good idea to allow for-profit companies to buy up all the religious-run and other non-profit hospitals? They used to be all over the place and now they’re all gone, or being run “under contract” by for-profit companies. How did this happen and why wasn’t it all over the news?

  21. Glenn E. says:

    Health Insurers heal thyself. Ha! When it all hits the fan, don’t come crawling to the government for a bail out, without conditions you feel might cramp your style.

  22. GetReal says:

    If you think we have anything like free enterprise in our health insurance industry, read this – if you have the guts.

    Pay special attention to #5 you free enterprise dupes!

  23. RSweeney says:

    Uncle Dave, imagine your anger had the Bush administration had a secret deal with insurers (and drug companies) for legislation in exchange for advertising in support or mere silence.

    Chicago-style corruption is now the new center.
    Change indeed.

  24. MikeN says:

    Bobbo, I was talking about overhead. Money spent on anti-fraud, counts as overhead, while money saved due to anti-fraud means a lower base from which to work with, so even more spent on overhead.

    Say Medicare is spending 300 billion and 15 billion on overhead. 5% administration costs.

    If Medicare then spend 5 billion and roots out 10 billion in waste, they now have 20 billion overhead on 290 billion in claims, 6.9% administration costs.

    The insurance companies have higher overhead because they go after the claims.

  25. Pla says:

    Difference with car insurance is I can decide I don’t need or can’t afford a car. I can’t decide not to live…

    Actually, even car insurance is not required – you have the option to hold $25000 as your own liability instead of buying insurance.

  26. Randy says:

    Folks, I wouldn’t worry too much. Big Pharma (Merck, J&J, etc) hasn’t been innovating for some time and biotech will soon be offshored, in addition to software support and core R&D. I wouldn’t too much about the private sector economy, as for the most part, finance will be the only thing left in America. All and all, it’ll be like the whole nation working for a hedge fund.


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