Health Reform Trends, Research and Analysis

Download PDF Report >>> Tell me something I dont know

You know the good features in the Affordable Care Act. You know Republicans want to repeal it.  Fine, so “tell me something I don’t know”.

REPUBLICAN PROPOSALS

For instance, did you know that Nixon proposed a comprehensive health reform plan in 1974, or that Republicans countered Clinton’s health reform with their own in ‘93? What were some of their reforms?

Start with the ever-popular individual mandate. Republicans were strongly for it. Now they are solidly against it.  Banning exclusions due to pre-existing conditions?  They were for that before they were against it.  How about:

• requiring employers offer health
  insurance to employees
• banning unjust cancellations
• creating standard benefit plans
• and State Run Purchasing groups
• and high-risk pools
• and re-insurance pools
• leveraging private health insurers
• and bending down the Medicare spend curve

That’s right. Republicans were for all of these … before they were against them.  Republicans now contradict dozens of provisions that they initiated and supported as far back as 37 years ago.

GOVERNMENT TAKEOVER

Critics complain reform is a government takeover of health care. Question. Would Republicans support an insurance program that:

• Government would directly manage?
• would be mandatory for some?
• would be sold at below cost?
• would have no pre-existing exclusions?
• would need billions of dollars in taxpayer subsidies?

If you said NO, you would be wrong. These are provisions of the 2008 Federal Flood Insurance Program, and all but two Republican Senators voted in favor of this plan.

If government involvement is for your health, that’s socialism.  If government involvement is for your house, well that’s OK.

TORT REFORM

Critics claim that Tort reform drives down costs.  Johns Hopkins Hospital might say “not so fast.”  They virtually eliminated blood-stream infections via a simple five-step checklist like airline pilots use.

Instead of penalizing victims of serious medical mistakes, why not put more focus on reducing those mistakes in the first place?  It lowers costs and improves outcomes – a win-win for everyone.  Affordable Care Act puts
its focus on prevention.

PROFITABILITY AND RETURN ON SALES

Health insurers claim a low return on sales. Yet, their “sales” apply to less than half of all insured workers. The other half are covered by their Employers’ self-insured plans.

Neither their medical costs nor their “premiums” are on insurers’ books, only administrative fees and expenses. How does this affect the five biggest insurers in 2009-2010?

Subtracting insured medical costs from both revenues and expense makes the reporting basis the same for insured and self-insured. Restated, that marginal 5% return jumped to a spectacular 20% return on sales.

INSURED MARGIN IS 20 TIMES SELF-INSURED

Further, Health Insurers’ operating margin per self-insured member was about $20. For each insured member, that margin was over $400, or 20 times greater than self-insured. This does include risk but still, it seems a rather stiff penalty on individuals and small business.  Affordable Care Act reins in abuses with State Insurance Review Boards.

In conclusion, gradual implementation gives critics a window to make false claims.  It might help to remind folks that politicians who want to repeal reform were once ardent supporters of many of its provisions.

Download PDF Report >>> Tell me something I dont know

Filed under: Commentary, Congress, Health Insurers, Healthcare Reform | Tagged: Health Insurers, Republicans, Return on sales, Self-insured, small business, tort reform |