Insurance Agents View of Obama Health Plan

In the 1990's it was the now-defunct Health Insurers Association of America that led the charge against Hillary Clinton''s health care reform plan, marshalling the entire business community in a revolt that had at least a bit to do with the Republicans'' take-over of Congress in 1994. But as the health insurance community prepares for revived efforts at health care reform under president Obama, it is not the insurers who write the coverage, but the producers who sell it, that seem most alarmed by changes that could be coming.

America''s Health Insurance Plans greeted the Obama victory by declaring its members "support coverage for all Americans, coverage they can afford, and coverage they can keep," and the Blue Cross Blue Shield Association said Obama''s health care agenda has "in common many of the same stepping stones to health care reform" as the Blues'' own plan.

But agents and brokers have been far less sanguine about what it could mean for them.Though several aspects of Obama''s health plan concern them, the issue that has benefits brokers most concerned is the proposed "National Health Insurance Exchange," a federal pooling mechanism open to all businesses and all individuals. By making the federal government the primary intermediary in the benefits market, and greatly curtailing the degree to which group plans can differ in cost or design, the NHIE, some fear, could effectively displace the agent community nationwide.

"None have been successful in lowering costs," Abadie said. "However, repeated failures have not dissuaded lawmakers."And it isn''t just life/health specialists who are paying attention. Agents and brokers that traditionally have been engaged primarily in commercial property/casualty increasingly have been relying on the profitable growth of health benefits as a hedge against the waning and waxing of the insurance pricing cycle."Employee benefits, for independent agents, is the fastest part of their book of business," said Robert Rusbuldt, president of the Independent Insurance Agents & Brokers of America. "For a medium-size agency, employee benefits is now constituting a meaningful size of their book of business, and it''s the most profitable part of their book of business, because there''s no soft market."While many in the health insurance community were just as concerned about aspects of Sen. John McCain''s health plan – particularly its suggestion of capping the deductibility of employer-provided benefits – Joel Wood, senior vice president of government affairs with the Council of Insurance Agents and Brokers, noted there also had been an understanding that McCain would have been unlikely to ever get his plans through a Democratic-controlled Congress. Obama will have other problems with his plan, including finding the money to pay for it, but congressional support will not be one of them. "To the extent that anybody''s going to pay for it, beyond those individuals making more than $250,000, who will pay for everything under the Obama plan, there has been this nebulous conversation about ''meaningful contributions'' from employers," Wood said. "We think that that could have the perverse effect of driving more people into the federal system, doing the Massachusetts-style thing, where you just pay your penalty up-front for not covering your own folks and then you wind up with a dysfunctional governmental system."

How Children Fare in the Health Care Debate

A report has detailed how children are treated in the health care plans of Senators John McCain and Barack Obama. The report identifies both opportunities and concerns with the policy changes outlined by both candidates, with an eye toward whether the plans would ensure access to comprehensive and affordable health care insurance for every American child.

The report takes into consideration the unique health care needs of children when analyzing the impacts of tax credits, purchasing private insurance across state lines, covering children through a mandate, and how public programs interact with private sector coverage.

The report concludes the following regarding Senator McCain's plan:

-- The McCain tax credit will weaken families' ability to afford coverage for children, as it is insufficient to make coverage affordable and does not keep pace with growth in the cost of health care premiums. Specifically, the tax credit fails to adjust for family size and the added cost when children are born or adopted. Therefore, the credit provides assistance for a significantly smaller share of health care costs for families with children than for childless households.
-- The 19 million children with special health care needs currently insured though employer coverage may be barred from insurance due to pre-existing conditions. Children who need insurance most, those who are sick today, could be charged much more for insurance, if they are
offered insurance coverage at all.
-- By allowing insurance to be sold across state lines, millions of children will lose the protection of having guaranteed benefits. In fact, it is estimated that up to 55 million children could lose the
protection for mandated coverage for well care visits, 18 million could lose autism care, and 16 million children could lose lead poisoning treatment.
-- Funding for public insurance programs for low-income children could be reduced, through McCain's proposed reductions in Medicaid spending.


The report also concludes the following with regard to Senator Obama's plan:
-- The plan seeks to ensure that all of the more than 8 million children currently without health insurance will become insured throughcombination of public and private coverage options and by requiring parents to enroll their children in coverage.
-- Successful public programs will be expanded and strengthened to provide coverage to more children. The Obama plan would continue and expand Medicaid and State Children's Health Insurance Program (SCHIP), critical programs that act as safety-net coverage for children.
-- Tens of millions of children will benefit from improved consumer protections in the private health insurance market.

The report can be viewed at http://www.firstfocus.net/pages/3519/.