Health insurers stand firm on reform critique, predicting high premiums

A few weeks ago, trade group America's Health Insurance Plans released a study suggesting that provisions in the Senate Finance Committee health reform proposal would have the effect of significantly raising insurance premiums. Since then, AHIP leader Karen Ignagni has been making the rounds defending the study which, while basing its conclusions on some commonly-accepted premises in public health, certainly came at, let us say, an interesting point in the debate.

The study, which was conducted by PricewaterhouseCoopers, concludes that unless everyone in the market is required to participate in carrying insurance, the insurance industry would continue to have to carry significant numbers of unwell uninsured people, which would raise costs for individuals and small businesses. It suggests that premiums could rise as much as 18 percent or more over the next 10 years.

Whether its conclusions were correct or not, the report has been roundly criticized in some circles as a last-minute attempt to sandbag health reform efforts. Some have said that the timing of the report, which came at a time when the Finance Committee seemed likely to weaken or remove provisions requiring all Americans to have coverage, was intended as a no-holds-barred attack to force its requirements into the bill.

These criticisms haven't slowed AHIP down one iota, however. In fact, its next move was to run a six-state ad campaign arguing that seniors enrolled in private Medicare plans could lose benefits under current health reform proposals. The question, at this point, is whether AHIP has succeeded in raising awareness of its arguments, or simply in giving the Obama Administration a fatter target to attack at a critical moment.

To learn more about the debate:
- read this Washington Post piece
- read the PwC report

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