For the first time ever, there was an offer on March 24 from the health insurance industry to suppress its disputed procedure of charging higher premiums to people with medical problems.
This offer came from the Blue Cross and Blue Shield Association and America’s Health Insurance Plans and was contained in a letter to key senators. This may mean an important change in the debate over reconstructing America’s health care system to restrict costs and cover approximately 48 million uninsured people.
The letter indicated that the two insurance industry group’s members are agreeing to “phase out the practice of varying premiums based on health status in the individual market” if everyone in the nation is required to get coverage. This said, the letter also indicated that they would still charge different premiums depending on factors such as age, place of residence, family size and benefits package. Important to mention is the fact that the companies did not agree to cease charging the sick higher premiums when it comes to small businesses. Small business employers who offer coverage to their employees may see their premiums increase each year, even if there is only one worker or family member that gets severely ill. However, Karen Ignagni, president of America’s Health Plans, said that the industry is currently working on different proposals for this problem by talking to small business people around the nation and offering different strategies for them to use.
Karen Ignagni said that when everyone is in the system, financial assistance can be given to working families, which can be a move away from the health status rating.
Health economist Len Nichols, of the New America Foundation public policy center, says that “the offer here is to transition away from risk rating, which is one of the things that makes life hell for real people.” “They have never in their history offered to give up risk rating.”
Insurers are making an attempt to redirect the process of a government insurance proposal that would compete with them, a change that Democrats and liberals are fighting for. The insurance industry has already yielded to a number of demands to try to achieve political support. Just last year, they offered to stop denying sick people coverage. They also agreed to encourage a national goal of preventing rising costs.
Currently, insurance companies are charging escalated premiums to people who try to buy coverage as individuals with a record of medical problems such as heart disease or cancer. When the person is allowed coverage, they are frequently incapable to afford such high premiums. Around 7 percent of Americans purchase their coverage as individuals, while there are 60 percent who get their insurance through their job.
On the Net:
- Blue Cross and Blue Shield Association: http://www.bcbs.com/
- America’s Health Insurance Plans: http://www.ahip.org