Insurers scramble to adapt to healthcare reform law

Despite talk by those who would like to see all or part of the healthcare reform law reversed, insurers cannot afford to put off changes to adapt, the New York Times reports. Some are altering their business models to survive.

"It is really the Manhattan Project because of the scale and the scope," Karen Ignagni, who heads up America's Health Insurance Plans, said.

On Sept. 23, the first round of changes under the new law took effect and it's likely the coming months will serve as a dry run for the more far-reaching changes required by the law in 2014 when payers will have to offer coverage to everyone and sell their plans on state-run exchanges.

The stakes are high. The industry will have to show that it can oversee patient care and work with hospitals and doctors to improve quality of care while limiting costs. Those insurers that don't adapt to the evolving landscape may have to close down, healthcare analysts say.

Blue Shield of California has trained 2,500 people, or nearly half of its work force, about the new law's impact. Some 250 employees head up teams that are reprogramming computer systems, calculating the cost of new policies and ensuring the call center people know the right answers to customer questions.

What insurers are doing to adapt to the new rules varies. Some, such as WellPoint (NYSE: WLP), Cigna (NYSE: CI), and CoventryOne, stopped offering child-only policies, saying they had to ditch them to stay competitive. That move exacerbated tensions between the administration and insurance industry, ABC News reports. White House Press Secretary Robert Gibbs expressed disappointment in payer decisions to scrap child-only policies, which he characterized as insurers' going back on their word to abide by the law.

AHIP spokesman Robert Zirkelbach didn't directly address Gibbs' comment. "Our industry is focused entirely on implementing new reforms in a way that's going to minimize disruption," he told ABC.
 
To learn more:
- read the New York Times article
- here's the ABC News article

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