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ICYMI: State Employer Groups on MLR Definitions
Posted by The Campaign on June 16, 2010 at 1:23 PM
What They Are Saying – State Employer Groups:
Medical Loss Ratio Definitions
(Excerpts taken from comment letters submitted to NAIC or State Insurance Commissioners)
o “We ask that you carefully construct your MLR recommendations so that these rules do not result in premium increases, which would be detrimental to employer-sponsored health plans.”
o “The Chamber appreciates your efforts on minimum loss ratio and urges you to approach the issue in a way that will minimize disruption and maximize the kind of activities that improve the quality and affordability of health care.”
The Business Council of New York State, Inc.
o “It is essential that MLR recommendations not be narrowly constrained limiting New York employers’ flexibility in plan design and their ability [to] continue to offer affordable, quality coverage.
o “The Business Council urges you to ensure that MLR recommendations recognize the value of health plans in driving quality and ensuring that consumers continue to have access to critical activities that improve the quality and the value of their care. This is very important in New York State – often recognized as a state with among the highest costs in the country – because employers have moved more aggressively into areas which have proven effective in managing employee wellness, allowing employers to better control plan costs without compromising quality.”
o “The Business Council asks that those quality measures which are valuable to employers and their employees be included in the MLR calculation, including: wellness programs, disease management programs, fraud, waste and abuse activities, and certain health information technology tools. These measures provide valuable services to employees improving their health and the value of the care they receive. Failure to include these measures would increase costs for employers, and could jeopardize programs that are valuable to employees and beneficial to their health.”
o “Many activities undertaken already, and many that will be required as a result of PPACA, include the developing, gathering, aggregation, and analysis of data in order to measure and incentivize quality, credentialing of providers, etc. We support such activities, and believe that both quality and transparency must be paramount in order to make health care more efficient, affordable, and to improve patient care.”
o “Our objective is to ensure that New York employers are not burdened with regulations which so narrowly define an MLR as to cause plan design changes which will drive up costs even further.”
o “The MLR definitions could have a considerable impact on our member’s ability to provide coverage and result in additional premium increases that would be detrimental to employer-sponsored health plans in Ohio. Therefore, the Ohio Chamber urges you, and the other NAIC members, to carefully consider your recommendations regarding these rules.”
o “Wellness and prevention initiatives have demonstrated that they lead to lower costs for consumers by improving health and wellbeing.”
o “There are several types of programs that employers and insurers implement that are crucial to keeping the cost of insurance premiums as low as possible. We believe capturing these programs in the MLR definition of quality activities will provide an incentive for these programs to be maintained.”
o “[We are] writing because the MLR definitions could have a considerable impact on our members’ ability to provide coverage. We ask that you carefully construct your MLR recommendations so that these rules do not result in premium increases which would be detrimental to employer-sponsored health plans.”
o “…we urge you to recommend the following:
· “Wellness and prevention be included under the umbrella of quality initiatives…[w]ellness and prevention initiatives have been demonstrated to lead to overall lower costs for consumers by improving their health and wellbeing, and none of them should be considered ‘administrative.’”
· “Include all quality, fraud and abuse, and cost control initiatives that clearly improve quality and patient safety in the definition of ‘activities that improve health care quality.’
· “We are concerned that not capturing these programs in the MLR definition of quality activities means that insurers will have a strong disincentive to spend on these activities as they well increase administrative costs and reduce medical expenses.”
o “We appreciate your efforts on minimum loss ratio and urge you to approach the issue in a way that will minimize disruption and maximize the kind of activities that improve the quality and affordability of health care.”
Association of Washington Business: Washington State’s Chamber of Commerce
o “This issue is of great concern to the members of the Association of Washington Business as the final rules could significantly impact our member’s ability to continue providing health care coverage to their employees.”
o “…[we] ask that you carefully construct the MLR recommendations so that the rules do not result in premium increases, as such would be highly detrimental to employer-sponsored health plans.”
Additionally, the Connecticut Business & Industry Association, Maine State Chamber of Commerce, Missouri Chamber of Commerce and Industry, and the Wisconsin Manufacturers & Commerce all have sent letters on the MLR issue.
ICYMI: What They Are Saying About Health Care Costs
Posted by The Campaign on March 24, 2010 at 11:47 AM
While the House has passed health care reform legislation, experts continue to point out concerns about what the legislation will mean for costs and premiums.
Here are what some independent experts have said:
Associated Press: “...there’s very little reason to think premiums will go down.” (Associated Press, 03/24/10)
Uwe Reinhardt, Economist, Princeton University: "What drives prices is the amount of services people are getting, plus the prices doctors and hospitals charge for those services." (Health Day/Harris Interactive, Poll Finds Americans Blame Insurers, Drug Companies for Rising Health Costs, 03/24/10)
Dan Mendelson, Avalere Health: "You'll continue to see premium rates go up because there are so many aspects of the system that are still increasing prices." (AP, Health Overhaul Promises Pain, Gain for Businesses, 03/22/10)
Drew Altman, Kaiser Family Foundation: "Premiums will continue to go up." (The Washington Post, Ezra Klein, An interview with Kaiser's Drew Altman, 03/22/10)
Uwe Reinhardt, Economist, Princeton University: "This thing will not get us off the hook cost-wise." (The Washington Post, Ezra Klein interview with Uwe Reinhardt, 03/22/10)
FACT CHECK: What They Are Saying About Costs
Posted by The Campaign on March 16, 2010 at 5:00 PM
Uwe Reinhardt, economist, Princeton University:
“What really drives it is the cost trend of health care, which is composed in part of utilization and in part of prices.” (Milwaukee Journal Sentinel, Insurers alone can’t be blamed for rates, economists say, 03/13/10)
Mort Kondracke, Roll Call:
“CMS figures show that insurance costs closely track the underlying — and surging — costs for hospitals, doctors and drugs. National health spending rose a whopping 5.7 percent in 2009, according to a February CMS report, and the ‘primary drivers’ were a 5.9 percent increase in hospital costs, a 5.2 percent increase for drugs and 6.3 percent for physician care. Insurance company administrative costs were not even mentioned as a driver — they dropped 2 percent last year — and abundant evidence indicates that industry profit margins run 3 percent to 4 percent, compared with 20 percent for drug companies and an average 13 percent for the health care industry.” (Roll Call, Will Democrats Fare Worse With or Without Passing Obamacare?, 03/11/10)
Robert Samuelson, The Washington Post:
“Whatever their sins, insurers are mainly intermediaries; they pass along the costs of the delivery system. In 2009, the largest 14 insurers had profits of roughly $9 billion; that approached 0.4 percent of total health spending of $2.472 trillion. This hardly explains high health costs. What people need to know is that Obama's plan evades health care’s major problems and would worsen the budget outlook. It’s a big new spending program when government hasn’t paid for the spending programs it already has.” (The Washington Post, Obama’s illusions of cost-control, 03/15/10)
“The big problem is uncontrolled spending, which prices people out of the market and burdens government budgets. Obama claims his proposal checks spending. Just the opposite. When people get insurance, they use more health services. Spending rises.” (The Washington Post, Obama’s illusions of cost-control, 03/15/10)
Dr. JudyAnn Bigby, secretary of the Executive Office of Health and Human Services:
“So much of what drives costs now is the revenue that hospitals want to generate.” (The Boston Globe, Insurer details its unequal payments, 03/16/10)
USA Today:
“As the debate reaches the endgame, here are five ways the final product could be better: -- Go after costs. The biggest void in the legislation is any major effort to control medical inflation…” (USA Today, Our view on medical reform: Five ways to improve the health care hybrid, 03/16/10)
Doug Schoen, Democratic Pollster:
“The data has been clear since at least the summer about how the American people feel about health insurance and their fears about the scope of government and the cost of this initiative. They would like greater focus on cost than any other goal.” (Politico, The handwriting on the wall, 03/15/10)
San Diego Union-Tribune:
“Another factor that has barely been debated is also sure to inflate premium costs…because the annual fine for refusing to buy health insurance is only up to $750 or 2 percent of income, whichever is greater, millions of Americans would pass on coverage, aware they could readily get insurance if facing a major medical problem. This ‘free riding’ means honest citizens would have to pick up the tab for those who game the system.” (San Diego Union-Tribune, Health Reform Bill Fails Two Tests, 03/16/10)
The Wall Street Journal:
“Above all other reasons, voters who oppose ObamaCare cite their fear over costs: They think it will cause their insurance premiums to soar and result in far higher taxes to fund a vast new entitlement.” (The Wall Street Journal, The Cost-Control Illusion, 03/13/10)
Richard Lord, Associated Industries of Massachusetts:
“You have to address the underlying medical costs.” (The Boston Herald, Business group backs health-care price caps, 03/11/10)
FACT CHECK: What They Are Saying About Health Plan Profits
Posted by The Campaign on March 08, 2010 at 7:39 AM
Independent experts and economists all agree -- health plan profits are not driving health care costs or premiums higher. Here are what some of the experts are saying:
Alwyn Cassil, Center for Studying Health System Change:
“‘…this idea that (taking) this $12 billion that they have in profits … would fix our health-care spending problems is just a pipe dream.’” (Louisville Courier-Journal, Health insurers defend profits, 02/21/10)
Henry Aaron, Senior Fellow, Brookings Institution:
“‘Insurance company profits in the large picture have very little to do with the overall rising cost of health care,’ said health care expert Henry Aaron, a senior fellow at the Brookings Institution.” (ABC News, Health Insurance Profits: Not So Outrageous After All?, 11/10/09)
Kaiser Health News:
“With the nation’s health care spending estimated at $2.5 trillion this year, even the elimination of insurers’ profits and executive compensation would lower health care spending by just 0.5 percent.” (Kaiser Health News, Ad Audit: What If?, 06/19/09)
Jeff Jacoby, The Boston Globe:
“To such overheated agitprop, the only useful response is a cold shower of facts, and the Associated Press supplied a timely one last week. For all the impassioned talk about obscene profits and bodies piling up, reports AP’s Calvin Woodward, ‘health insurance profit margins typically run about 6 percent’ of revenue, a return ‘that’s anemic compared with other forms of insurance and a broad array of industries.’” (The Boston Globe, Jeff Jacoby, Hyperbole in the health debate, 11/01/09)
Rick Newman, U.S. News & World Report:
“...on the whole, blaming insurance firms for runaway healthcare costs is a weak argument, because the insurance industry isn’t all that profitable to start with.” (U.S. News & World Report, Why Health Insurers Make Lousy Villains, 08/25/09)
Steve Pearlstein, The Washington Post:
““Health insurance companies aren’t ridiculously profitable over time.” (The Washington Post, Weekly Q & A, 10/28/09)
Associated Press:
“Health insurance profit margins typically run about 6 percent, give or take a point or two. That’s anemic compared with other forms of insurance and a broad array of industries, even some beleaguered ones.” (Associated Press, FACT CHECK: Health insurer profits not so fat, 10/25/09)
Dr. Peter Kongstvedt, Economics Professor, George Mason University:
“Insurance companies are not the major drivers of cost inflation.” (CBS News)
Ezra Klein, The Washington Post:
“...it’s hard to see how [health plan profit margins of 3.3%] are a primary driver of health-care spending, much less the growth in health-care spending.” (The Washington Post, Ezra Klein, Profits and the Insurance Industry, 09/10/09)
Rick Newman, U.S. News & World Report:
“Some reformers want health insurers to simply hand over a chunk of their profits to help lower premiums and overall healthcare costs. The Senate Finance Committee bill, for instance, would levy a $6.7 billion annual fee on insurers to help pay for reform, in addition to fees on drugmakers and device manufacturers. But insurance companies aren’t the cash cows some imagine them to be. The profit margin for health insurance companies over the past year was 3.4 percent, according to the research firm Morningstar. That’s better than the median of 2.2 percent, but it ranks only 87th out of 215 industries. Drugmakers, by contrast, have a profit margin of 16.4 percent.” (US News & World Report, Why More Competition Won’t Fix Healthcare, 10/29/09)
The New York Times:
“The president said that health insurance companies were making ‘record profits.’ America’s Health Insurance Plans, the main lobby for insurers, contends that ‘for every $1 spent on health care in America, approximately one penny goes to health plans’ profits.’” (The New York Times, Experts Dispute Some Points in Health Talk, 07/23/09)
Les Funtleyder, Health Care Analyst:
“‘2008 was a terrible year. So the comparisons, while numerically correct, leave out a bit of context.’ Health care analyst Les Funtleyder at Miller Tabak says millions of people lost coverage last year because they lost their jobs, not because insurers purged their rolls.” (Marketplace, Insurer profits rise while coverage falls, 02/12/10)
Bill Frezza:
“If you took all the profits that all the health insurance companies made in 2009 and used them to pay for medical care in 2010 you would cover the country's medical bills for ... two days. Then what?” (RealClearPolitics.com, Why Washington Can't Reform Healthcare, 02/15/10)
What They Are Saying: Costs and Premiums
Posted by The Campaign on February 24, 2010 at 8:00 AM
What They Are Saying About Costs and Premiums
- Alwyn Cassil, Center for Studying Health System Change: “The biggest factor driving up premiums, she said, is the fast-increasing amount that is spent on medical care. And that is driven by how much doctors are paid and how many services they provide…The price hikes by doctors, hospitals and other providers hasn’t gotten enough attention, she said.” (AOLNews, Who’s the Bad Guy in Insurance Premium Hikes?, 02/21/10)
- Paul Ginsburg, Center for Studying Health System Change: “And ‘the elephant in the room that no one has focused on is providers’ power to get higher rates from insurers.’” (USA Today, Impact of bipartisan summit to be felt beyond health care, 02/24/10)
- Uwe Reinhardt, Economist, Princeton University: “‘Everyone is beating up on the insurance companies, but you may be shooting at the wrong target…’” (AOLNews, Who’s the Bad Guy in Insurance Premium Hikes?, 02/21/10)
- Alwyn Cassil, Center for Studying Health System Change: “‘…this idea that (taking) this $12billion that they have in profits … would fix our health-care spending problems is just a pipe dream.’” (Louisville Courier-Journal, Health insurers defend profits, 02/21/10)
- The Washington Post: “The president also would give the government power to block increases in health-care premiums. Given public concerns about a federal takeover of the health-care system, letting the government essentially dictate premiums hardly seems like a step in the right direction. More than half the states already require their insurance commissioners to approve rate increases in the individual or small-group markets; the House- and Senate-passed bills provide authority to review increases for insurers participating in the newly created exchanges. The White House argues that this power will help shield consumers in the four years before the exchanges are up and running, but its recent use of the insurance industry as a political scapegoat does not bode well for its responsible use of such authority.” (The Washington Post, Editorial: On health care, Mr. Obama lets the next president do the hard stuff, 02/23/10)
- Los Angeles Times: “The unfortunate reality in healthcare reform is that there is no quick fix to reducing premiums or even bringing their growth into line with inflation. The ever-increasing cost of insurance reflects the incessant growth in healthcare spending. And the solution is to reduce the supply of money for healthcare, lower the demand for medical services, or do both.” (Los Angeles Times, Editorial: Back to the drawing board, 02/08/10)
- Kim Holland, Oklahoma Insurance Commissioner: “Holland noted that state regulators are responsible for assuring the solvency of plans, not just reviewing rates. One question about the Feinstein proposal is the consequences that could occur from having the federal government only focusing on rates without specifically having responsibility over solvency. She suggested that federal denial of rate increases could create solvency concerns…Holland emphasized that rising medical costs are the underlying driver of rising premiums and that policymakers need to focus on those rising costs.” (CQ, Insurers, State Regulators Fault Federal Review of Rate Hikes, 02/22/10)
- Sandy Praeger, Kansas Insurance Commissioner: “‘If you want to keep costs under control, it’s not about managing health care premiums…it’s about managing the underlying health care costs.’” (Kaiser Health News, State Regulators Criticize Obama Plan To Create Federal Authority Over Health Insurance Rates, 02/22/10)
- Ralph Neas, National Coalition on Health Care: “‘None of the proposals yet has done enough on cost containment.’” (USA Today, Impact of bipartisan summit to be felt beyond health care, 02/24/10)
What They Are Saying: Federal Rate Review
Posted by The Campaign on February 24, 2010 at 7:35 AM
What They Are Saying About Federal Rate Review
- Los Angeles Times: “But the more ballyhooed initiative to have federal bureaucrats review insurance premiums…wouldn’t address the forces driving up the cost of medical care.” (Los Angeles Times, Editorial: Obama’s Summit, 02/23/10)
- The Washington Post: “The president also would give the government power to block increases in health-care premiums. Given public concerns about a federal takeover of the health-care system, letting the government essentially dictate premiums hardly seems like a step in the right direction. More than half the states already require their insurance commissioners to approve rate increases in the individual or small-group markets; the House- and Senate-passed bills provide authority to review increases for insurers participating in the newly created exchanges. The White House argues that this power will help shield consumers in the four years before the exchanges are up and running, but its recent use of the insurance industry as a political scapegoat does not bode well for its responsible use of such authority.” (The Washington Post, Editorial: On health care, Mr. Obama lets the next president do the hard stuff, 02/23/10)
- National Association of Insurance Commissioners: “State insurance regulators reacted coolly Monday to provisions in the new White House health care overhaul plan that would the give the secretary of Health and Human Services power to deny excessive premium increases. ‘By and large I think the states are very effective in monitoring’ insurance markets, said an official with the National Association of Insurance Commissioners.” (CQ, Insurers, State Regulators Fault Federal Review of Rate Hikes, 02/22/10)
- Sandy Praeger, Kansas Insurance Commissioner: “‘I think we’re chasing the wrong tail here. It’s really about health care costs…In most cases, the companies have been able to justify them, because of the economic situation. The book of business is probably getting sicker because healthier people are dropping out.’” (NPR, Obama Plan Would Monitor Insurance Premiums, 02/23/10)
- Detroit News: “A new wrinkle added by the president would give the federal government rate-setting oversight for insurance policies. That’s a responsibility now handled by the states. Involving Washington in rate setting would add another political layer to an already contentious process and likely make it impossible for insurance companies to recover their costs, driving them out of business.” (Detroit News, Editorial: Obama’s Compromise Health Care Proposal Looks Too Much Like The Old Plan, 02/23/10)
- Uwe Reinhardt, Economist, Princeton University: “‘Everyone is beating up on the insurance companies, but you may be shooting at the wrong target…’” (AOLNews, Who’s the Bad Guy in Insurance Premium Hikes?, 02/21/10)
- Kaiser Health News: “State insurance regulators said President Barack Obama goes too far with his proposal Monday to give the federal government new power to reject health insurance rate increases. Three veteran state insurance commissioners said in interviews that states are in a better position to judge insurers’ premium proposals.” (Kaiser Health News, State Regulators Criticize Obama Plan To Create Federal Authority Over Health Insurance Rates, 02/22/10)
- Kim Holland, Oklahoma Insurance Commissioner: “‘Health insurance is very localized and states already have a number of tools to monitor rates,’ she said. ‘Overall, I think state regulators do a good job.’” (Kaiser Health News, State Regulators Criticize Obama Plan To Create Federal Authority Over Health Insurance Rates, 02/22/10)
- Chicago Tribune: “Price controls. Yes, price controls…That practice would not work any better in health insurance than elsewhere. It would induce companies to cut back on the procedures they cover, cutting costs by reducing services. It would also encourage WellPoint and other insurers to simply get out of the individual policy business entirely, to the benefit of no one.” (Chicago Tribune, Editorial: Price controls?, 02/23/10)
- Robert Laszewski, Health Care Policy Analyst: “There is nothing new in it save a health insurance rate regulatory board that is an awkward political proposal at best…Fundamentally, what good would insurance rate regulation do if the President’s plan has only tepid cost containment built into it in the first place?” (The Health Care Blog, The President’s Health Care Plan, 02/22/10)
- Joel Ario, Pennsylvania Insurance Commissioner: “‘It could end up as a “who’s on first and what’s on second” problem,’ he said.” (Kaiser Health News, State Regulators Criticize Obama Plan To Create Federal Authority Over Health Insurance Rates, 02/22/10)
- Seattle Weekly: “Practically, however, a rate board is unlikely to do much, judging by Washington state’s experience with similar regulation…Stephanie Marquis, a spokesperson for Insurance Commissioner Mike Kreidler, says her boss’s hands were tied. He has to go along with rate increases if insurance companies show that they are paying out more money than they are taking in. And the reality is, Marquis says, that insurance companies lose money in the individual market, which holds just a sliver of the total population, and one that tends to need a lot of expensive care.” (Seattle Weekly, Washington State Offers Dismal Lesson for Obama's New Attempt to Save Health Care Reform, 02/23/10)
- The Wall Street Journal: “The bill’s one new inspiration is a powerful federal board that would regulate premiums in the individual insurance market. In all 50 states, insurers are already required to justify premium increases to insurance commissioners, who generally have the power to give a regulatory go-ahead, or not. But their primary concern is actuarial soundness and capital standards, making sure that companies have enough cash to pay claims. The White House wants to create another layer of review that will be able to reject any rate increase that is ‘unreasonable or unjustified.’ Any insurer deemed guilty of such an infraction by this new bureaucracy ‘must lower premiums, provide rebates, or take other actions to make premiums affordable.’ In other words, de facto price controls.” (The Wall Street Journal, Editorial: ObamaCare at Ramming Speed, 02/23/10)
- Sandy Praeger, Kansas Insurance Commissioner: “‘If you want to keep costs under control, it’s not about managing health care premiums…it’s about managing the underlying health care costs.’” (Kaiser Health News, State Regulators Criticize Obama Plan To Create Federal Authority Over Health Insurance Rates, 02/22/10)
- Kim Holland, Oklahoma Insurance Commissioner: “Holland noted that state regulators are responsible for assuring the solvency of plans, not just reviewing rates. One question about the Feinstein proposal is the consequences that could occur from having the federal government only focusing on rates without specifically having responsibility over solvency. She suggested that federal denial of rate increases could create solvency concerns…Holland emphasized that rising medical costs are the underlying driver of rising premiums and that policymakers need to focus on those rising costs.” (CQ, Insurers, State Regulators Fault Federal Review of Rate Hikes, 02/22/10)
- Portfolio.com: “States apparently can’t do this job themselves, according to the White House’s thinking. If that’s the case, where was this proposal a year ago, when the hard work of crafting health care reform legislation began?” (Portfolio.com, The Problem With Obama’s Plan, 02/22/10)
- Dave Shove, Analyst: “BMO Capital Markets analyst Dave Shove, who follows the insurance industry, said he doubts a federal rate review would push health plans into insolvency. But he said many details remain to be resolved, and a federal regulator might motivate insurers to stop selling individual policies in some markets. ‘That is a very real possibility,’ he said. ‘You probably will reduce choice for consumers.’” (AP, Insurers see potential for plan insolvency behind Obama's premium regulation proposal, 02/22/10)
- Alwyn Cassil, Center for Studying Health System Change: “‘…this idea that (taking) this $12billion that they have in profits … would fix our health-care spending problems is just a pipe dream.’” (Louisville Courier-Journal, Health insurers defend profits, 02/21/10)
ICYMI: What They Are Saying About the House Democratic Bill
Posted by The Campaign on November 07, 2009 at 11:35 AM
What They Are Saying on House Democratic Bill
Many elected leaders are speaking out against the House Democratic reform proposal because it does not do enough to control costs and in fact increases costs for individuals, families and employers.
Below find some of the comments from these elected officials:
Rep. Allen Boyd: "While the House bill does take some positive steps toward increasing coverage and reforming insurance regulations, it simply falls short when it comes to lowering healthcare costs for North Florida families and businesses. Improving our healthcare system is of utmost importance to me, but meaningful reform must reduce the skyrocketing cost of healthcare services. Until I have confidence that a healthcare reform bill will effectively curb rising healthcare costs and ease the burdensome pressure millions of Americans feel when paying their healthcare premiums or doctor bills, I cannot in good faith support this bill."
Rep. Glenn Nye: "Health care costs are crippling our small businesses and forcing families into bankruptcy, and any reform plan needs to reduce those costs. Although this version of the bill takes important steps to lower the deficit in the short term, the CBO has said that it does not address the fundamental problem of reducing skyrocketing health care costs. Small businesses are facing increases of ten to twenty percent in their health care premiums each year, and I am not convinced that this bill would fix that problem next year or the year after."
Rep. Mike McIntyre: "The need for health care reform is clear, but the focus should be on lowering the skyrocketing costs of health care, bringing down the cost of premiums, and ensuring access and affordability of health care for all. During these tough economic times, I could not support this bill because it was flawed in four major ways:
1. It costs way too much money - more than $1 trillion dollars on top of a $12 trillion national debt;
2. It does not take the steps necessary to effectively bring down long-term health care costs;
3. It raises too much in new taxes and imposes new requirements that will harm the ability of too many small businesses to compete and create jobs; and
4. It tries to do too much too soon instead of targeted changes that can immediately help people."
Rep. Eric Massa: "...the bill ‘fails to address the fundamental question before the American people, and that is, how do you control the costs of health care?'"
Rep. Frank Kratovil: "...I am still concerned that this bill does not do enough to bend the long-term cost curve..."
Rep. Brian Baird: "To insist that members vote on this legislation without having cost estimates of Medicare and Medicaid impacts ... or an estimate of premium impacts from the Congressional Budget Office seems premature and unwise."
MUST READ: WHAT THEY ARE SAYING -- New Health Care Taxes
Posted by The Campaign on September 18, 2009 at 6:18 AM
What They Are Saying -- New Health Care Taxes on Benefits
"The New AMT"
Unions:
GERALD MCENTEE – AFSCME: “The bill…taxes health plans that provide benefits for many middle class families.” (AFSCME Statement on Senate Finance Bill, 09/16/09)
ANDY STERN – SEIU: “…a tax on high cost plans will unfairly burden older workers and workers in high-cost states.” (SEIU Statement on Senate Finance Bill, 09/16/09)
ANNIE HILL – CWA: “‘On the funding side, we wouldn’t be able to support (the Baucus) option,’ she said during a meeting of the Bipartisan Policy Center last Wednesday (Sept. 9). ‘We have a huge concern about the excise tax that would be put on health care plans. It just seems way too complicated to figure out as ... it depends on the demographics of your workforce, the age of your workforce, the location of where you’re at. What is a Cadillac plan? Who decides that? There’s just too many things. And it doesn’t include the employer mandate which we think is the best way to go. So, [we have] huge concerns on that.’” (Inside Health Policy, Employers, Rockefeller Cite Concerns Over Insurance Excise Tax, 09/16/09)
JOHN SWEENEY – AFL-CIO: “Outrageously, the plan imposes a 35 percent tax on high-cost health care plans without prohibiting insurers from passing on the tax to consumers who happen to be in groups that are older or sicker than average or live in high cost areas.” (AFL-CIO Statement on Senate Finance Bill, 09/16/09)
Business:
JAMES A. KLEIN – AMERICAN BENEFITS COUNCIL: “The Council continues to have concerns with certain key aspects of this measure, such as the complicated and costly excise tax, other fees on health insurers and other stakeholders and the tax on valuable prescription drug coverage for retirees. These costs are all likely to eventually be paid by employers and employees and would therefore make health care less affordable” (ABC Statement on Senate Finance Bill, 09/16/09)
STEVE WOJCIK – NBGH: “If the tax is linked to inflation, fairly quickly, unless costs are under control, a lot of people will be bumped up to threshold amount, Steve Wojcik, vice president of public policy for the National Business Group on Health, said.” (Inside Health Policy, Employers, Rockefeller Cite Concerns Over Insurance Excise Tax, 09/16/09)
BRUCE JOSTEN – US CHAMBER: “This bill creates a new tax on benefits that may well spiral out of control to become the next Alternative Minimum Tax.” (Dow Jones, Democrats Cool Toward Parts of Baucus Health Proposal, 09/17/09)
Think Tanks:
THE HERITAGE FOUNDATION: “It applies a 35 percent excise tax on higher-cost plans, together with a new sales tax on pharmaceutical, health insurers, clinical laboratories and medical device manufacturers. These taxes will be passed through to patients. While self-insured health plans, typically offered by employers and including most union-negotiated plans, will not face the insurer tax, they will still be subject to the higher-cost plan tax.” (Heritage Foundation Statement on Senate Finance Bill, 09/16/09)
MICHAEL TANNER – CATO: “The Baucus plan imposes a 35 percent excise tax on health insurance plans that offer benefits in excess of $8,000. Insurers would almost certainly pass this tax on to consumers in the form of higher premiums. Roughly half of Americans, mostly middle-class, would be effected. There are also ‘fees’ on prescription drug companies, medical device manufacturers, and clinical laboratories. This is simply a way of hiding taxes, and will result in higher health care costs that will be passed on to consumers.” (The New York Times, “Room for Debate”, Grading the Baucus Health Plan, 09/16/09) http://roomfordebate.blogs.nytimes.com/2009/09/16/grading-the-baucus-health-plan/?hp
TOM MILLER – AEI: “‘The real game, at the end of the day to simplify it, is they have to pretend that they're getting some money out of somebody who is not a voter,’ said Tom Miller, a resident fellow at the conservative American Enterprise Institute. ‘Of course we know that will make it more expensive, pass that price right down to the employers,’ Miller said.” (FoxNews.com, Health Care Proposal to Tax Insurers May Affect Blue-Collar Workers, 09/16/09) http://www.foxnews.com/politics/2009/09/16/health-care-proposal-tax-insurers-affect-blue-collar-workers/
Elected Officials:
SEN. JAY ROCKEFELLER (D-WV): “The proposal would impose a big tax on virtually every single coal miner in his state because it would affect companies that are self-insured, Rockefeller said, noting that coal miners often get good insurance benefits because they’re doing a dangerous job. The tax is ‘not smart,’ Rockefeller said: ‘It’s a very dangerous idea.’” (Inside Health Policy, Employers, Rockefeller Cite Concerns Over Insurance Excise Tax, 09/16/09)
SEN. JOHN KERRY (D-MA): “We need to make it fairer to working people so that working folks don’t get dragged into this at a level where they just don’t have the incomes to support it.” (AP, Dems unhappy with proposed tax in health care bill, 09/17/09)
SEN. CHUCK GRASSLEY (R-IA): ““The whole goal here is to reduce costs to policyholders. This tax will increase costs.” (The New York Times, New Tax in Senate Health Plan Draws Bipartisan Fire, 09/18/09)
SEN. DEBBIE STABENOW (D-MI): “‘There is a misconception...that every high-cost plan is because it has great benefits and is a Cadillac plan,’ said Sen. Debbie Stabenow (D., Mich.). She said some workers who were forced into early retirement and whose premiums are high because they are in older insurance pools could get hit by the tax. Ms. Stabenow said she will press to raise the $21,000 threshold to $25,000. ‘It’s incredibly important that this get fixed,’ she said.” (Dow Jones, Democrats Cool Toward Parts of Baucus Health Proposal, 09/17/09)
SEN. DICK DURBIN (D-IL): “He said the tax could be passed through immediately to consumers, or it could become a ‘de facto ceiling on the cost of health insurance…’” (Politico, Live Pulse, Insurance tax draws comparisons to AMT, 09/17/09)
SPEAKER NANCY PELOSI (D-CA): “I think if that is to be the model, we have to see at what cost to the person who is insured.” (The Washington Post, Affordability Is Major Challenge for Reform, 09/18/09)
Media:
THE WALL STREET JOURNAL: “Some $215 billion is scrounged up by imposing a 35% excise tax on insurance companies for plans valued at more than $21,000 for families and $8,000 for individuals. This levy would merely be added to the insurers’ ‘administrative load’ and passed down to all consumers in higher prices.”
EZRA KLEIN – THE WASHINGTON POST: “…this hides a couple of things. First, some plans are very expensive because they're more generous. But some plans are more expensive because they're in wildly expensive markets. New Yorkers, for instance, are going to feel the brunt of this tax a lot more than, well, Montanans will…Second, the plans exposed to the tax cap are going to become progressively less generous over time…Thus, insurance plans will get more expensive faster than the tax cap will rise, and more of them will get hit by the excise tax. That's not going to be popular, but it will raise a lot of money, or barring that, offer an incentive for people to choose lower-cost plans.”
“I have trouble seeing this tax survive in the long run. There seems a substantial chance that it will become like the AMT, and Congress raises it year after year to escape consumer backlash. As I've argued before, the excise tax is a way to seem like you're taxing insurers rather than taxing health-care benefits, even as the practical effect is the same.” (The Washington Post, Ezra Klein, The Baucus Bill: Taxing Insurers, 09/16/09) http://voices.washingtonpost.com/ezra-klein/2009/09/the_baucus_bill_taxing_insurer.html
THE NEW YORK TIMES: “New Tax in Senate Health Plan Draws Bipartisan Fire”
ASSOCIATED PRESS: “Dems unhappy with proposed tax in health care bill”
POLITICO: "Insurance tax draws comparisons to AMT"
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