As Congress continues to work on health care reform, the insurance industry is lobbying against legislation that would include a government-run insurance program.
Last week, Senate Majority Leader Harry Reid said a health care reform bill would be introduced in the Senate that includes a government-operated insurance plan that states could opt out of. Reid's proposal didn't sit well with the insurance industry, which would rather see a stronger push to require all Americans to have insurance.
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"A new government-run plan would underpay doctors and hospitals rather than driving real reforms that bring down costs and improve quality," America's Health Insurance Plans President and CEO Karen Ignagni said in a news release last week. "The American people want health care reform that will reduce costs and this plan doesn't do that."
A government-run insurance program would have a "devastating effect," said Alissa Fox, senior vice president of Blue Cross & Blue Shield Association of Washington, D.C.
Such an option is "totally unnecessary to achieve the goals of reform," she said. "It's going to result in many people losing their existing private coverage, and it's going to underpay providers."
The AHIP, also of Washington, supports health care reform, spokesman Robert Zirkelback said last week. "Unfortunately, several proposals that are currently being considered allow the unintended consequences of significantly increasing health care costs for families and employers," he said.
The insurance industry has released several reports in the last month on the financial impacts of health care reform, although critics and skeptics have called some of the findings self-serving.
One study commissioned by the Blue Cross & Blue Shield Association showed that without a strong mandate to force people to buy insurance, "premiums for purchasers in the new marketplace will increase significantly."
The report, by the consulting company Oliver Wyman of New York and released on Oct. 14, said "insurance reforms alone will substantially increase claims costs in the individual market."
Another report commissioned by the insurance industry said the average family coverage cost today is about $12,300 and under current law, it will be $15,500 in 2013. And if reforms don't include a mandatory coverage requirement, premiums will cost $17,200 annually for family coverage in 2013, the report by PricewaterhouseCoopers of New York said.
Several groups dispute the insurance industry's findings, though.
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