Health plans' huge earnings spark fallout from politicians
Insurers, however, plan to stick with their strategy of maximizing rates while minimizing costs
By Emily Berry, amednews staff. Posted Aug. 16, 2010.
Health insurance executives say that, despite political backlash toward their profits and pricing, they will continue to push medical spending lower and keep premiums at the greatest possible margin above costs.
The statements came as the seven largest publicly traded health insurers generally reported second-quarter profits above analysts' expectations.
The plans credited lower health spending, in large part due to money set aside for a flu epidemic that wasn't as bad as expected, and in part because even insured patients were spending less on health care. The plans also credited their own "pricing discipline" -- keeping premiums as high as possible, even at the risk of losing members and standing with politicians.
During a second-quarter earnings conference call between UnitedHealth Group executives and investment analysts, Citigroup's Carl McDonald asked if the company was bracing for more resistance to rate increases and "pricing to trend" -- setting premiums higher as medical costs rise, allowing for consistent or even growing profit margins.
Given the political environment and the company's historic profit margins, which he cited at 7%, McDonald wondered if UnitedHealth Group could keep up those price increases. United said, yes it can.
■Higher premiums, higher profits
■Coventry takes hit from class-action lawsuit
■See related content
"I think that you can still price to trend. I think that is the appropriate long-term positioning of the organization," CEO Stephen Hemsley said.
Five of the seven largest shareholder-owned health plans -- Aetna, Health Net, Humana, UnitedHealth Group and WellPoint -- reported profits in the second quarter of 2010 better than the same period in 2009.
But all seven companies raised their estimates of the total profit they will bring in for the full year.
Net income for the quarter ranged from $1 million for Coventry Health Care to $1.1 billion for UnitedHealth Group. Coventry was charged $278 million for a class-action lawsuit settlement regarding its workers' compensation business in Louisiana.
United's per-share profit of 99 cents was up 37% from the same quarter in 2009, but that wasn't even the largest increase among the biggest seven insurers. Aetna reported earnings of $491 million, or $1.14 per share, a 48% jump, Humana and WellPoint reported a 20% jump in per-share earnings compared with the second quarter of 2009. Coventry earnings would have been up without the settlement.
Cigna's health insurance business did better than expected, but the company saw earnings drop because of losses in nonhealth business.
5 of 7 largest shareholder-owned health plans reported higher 2nd quarter profits in 2010 than in 2009. Most of the big health plans lost members and brought in lower revenue than the prior year but were still able to make a profit because of lower medical spending. For several insurers, a milder-than-anticipated flu season made a critical difference to earnings, allowing them to count as revenue money that had been set aside, but not spent, for the influenza A(H1N1) pandemic. For some plans, such as WellPoint, that turned around what would have been a profit decline from the second quarter of 2009.
Insurers also credited their care management programs and continued economic pressure that appeared to keep members from spending on care.
However, the debate over rates and the potential for further backlash as new health system rules take shape tempered investors' response to health plan earnings.
U.S. Reps. Pete Stark (D, Calif.) and Jan Schakowsky (D, Ill.) released separate statements demanding that insurers lower premiums in light of recent rate increases. They are co-sponsors of legislation, introduced July 22, that would establish a public health insurance option to be included in health insurance exchanges created by health system reform.
Schakowsky said the "windfall" quarterly profits "are the umpteenth example of why this industry needs to be checked."
Coventry and Cigna were the only plans Stark didn't mention by name in multiple releases chiding health plans. He put out a release July 28 slamming WellPoint, Aetna and UnitedHealth Group, then followed up with statements on Humana's Aug. 2 earnings report and Health Net's Aug. 3 earnings report.
"Last week we found that WellPoint and Aetna were reaping hundreds of millions more in profits while spending hundreds of millions less on health care," Stark said in the Aug. 2 release.
"Today's report shows another insurer having a banner year. I await announcements by Humana and other insurers that they will be passing along these billions to consumers in the form of lower premiums."
That doesn't appear to be in the cards. Angela Braly, WellPoint's CEO, president and chair, said during her company's quarterly conference call that she's confident her company will be able to get future rate increases approved despite resistance in some states in 2009 and 2010 -- most famously, in California, where a proposed 39% maximum increase for individual plans was credited with relighting the fire to get health system reform passed.
"We expect that over time, appropriate rates will be granted in order to sustain this important market segment for the many Americans it will serve," Braly said. "This market is projected to expand by 16 million people during the next decade as a result of health care reform, and creating a fundamentally sustainable marketplace will be critical."
The American Medical Association was critical of health plans after the release of the earnings reports, citing numbers that show rate hikes outpacing health spending overall and physician services in particular.
"Huge premium hikes and windfall earnings from the health insurance industry are out of step with the latest figures showing the slowest rate of growth in U.S. health care spending in nearly 50 years," said AMA Immediate Past President J. James Rohack, MD. "Spending for physician and clinical services grew 5%, the slowest rate of growth since 1996.
"While insurers propose double-digit price increases, the latest figures show prices for physician services increased by only 2.7%. In fact, inflation adjusted physician fees decreased by 25% between 1996 and 2006. More oversight is needed to make certain that insurers are not funding their multibillion-dollar merger and acquisition strategies on the backs of patients, physicians and employers."
The print version of this content appeared in the Aug. 23 issue of American Medical News.
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ADDITIONAL INFORMATION:
Higher premiums, higher profits
Most of the seven largest shareholder-owned health plans took in higher profits in the second quarter of 2010 than the same period in 2009, despite declining membership and lower revenue. Lower medical spending and an unexpectedly mild flu season boosted earnings. Company executives do not plan to back off requests for higher premiums where they believe them to be necessary, however. Dollar figures on revenue and income are given in millions.
Revenue Net income Earnings per share
2Q09 2Q10 (change) 2Q09 2Q10 2Q09 2Q10 (change)
Aetna $8,671 $8,546 (-1%) $347 $491 $0.77 $1.14 (48%)
Cigna $4,488 $5,353 (19%) $435 $295 $1.58 $1.06 (-33%)
Coventry $3,537 $2,868 (-19%) $18 $1 $0.12 $0.01 (-92%)
Health Net$4,014 $3,442 (-14%) $40 $45 $0.38 $0.45 (18%)
Humana $7,899 $8,653 (10%) $282 $340 $1.67 $2.00 (20%)
United $21,655 $23,264 (7%) $859 $1,123 $0.73 $0.99 (37%)
WellPoint $15,413 $14,457(-6%) $694 $722 $1.43 $1.71 (20%)
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Coventry takes hit from class-action lawsuit
Coventry Health Care reported steeply rising operating profits for the second quarter of the year, but its earnings were cut to a penny per share due to a court decision in a class-action lawsuit brought by four Louisiana physicians, among others. The Louisiana 3rd Circuit Court of Appeals ordered the company to pay plaintiff health care professionals and hospitals $278 million, representing fines, plus interest.
"We are still working hard and pursuing all avenues of appeal for the Louisiana court decision, which we believe is not supported by either the law or the facts," Coventry CEO and Chair Allen Wise said during a second-quarter earnings conference call with investment analysts July 30.
In 2008, physicians, chiropractors and hospitals sued Coventry subsidiary First Health Group, which operates a workers' compensation rental preferred providers organization. Rental PPOs are referred to as "silent PPOs" in which employers or health plans pay for access to network discounts without clearly disclosing that they are doing so.
In the First Health Group case, defendants included some self-insured employers and some health plans that were accessing the First Health workers' compensation network. Louisiana workers' compensation care is supposed to be paid under a fee schedule set by the state.
The plaintiffs alleged that they were not properly notified that payers were accessing the First Health network discount rates rather than paying according to the state's fee schedule. Louisiana state law requires notification of rental network arrangements.
The case has been taken through state and federal courts, and the remaining disputes center on which is the proper venue and whether the state court's summary judgment should stand.
The Louisiana State Medical Society filed an amicus brief for the plaintiffs with the state Supreme Court on Aug. 2, asking it to reaffirm the lower court finding that payers in Louisiana are not allowed to access network discounts for workers' compensation cases and must pay according to the state's fee schedule.
While appeals work their way through the court system, however, Coventry must account for the settlement they have been ordered to pay. The company recorded the $278 million charge in their second-quarter earnings statements.
Tuesday, August 17, 2010
Wednesday, July 28, 2010
Here we go AGAIN
I couldn't resist posting this information regarding Blue Cross and Blue Shield "NOT FOR PROFIT" health insurance companies. This is my first post since March 23 when President Obama signed the health care reform bill.
BCBS Plans Increased $4.5 Billion Since 2001:
An analysis by Consumers Union found that non-profit
Blue Cross Blue Shield (BCBS) health plans have collected billions in
surplus over the past decade while raising health care premiums. The report
notes that BCBS plans in 10 states (Alabama, Arizona, Massachusetts,
Michigan, New York, North Carolina, Oregon, Pennsylvania, Tennessee, and
Wyoming) held a collective $9.1 billion in surplus funds in 2009, or $855
per-member per-year. In 2001, those plans held $4.6 billion collectively, or
$395 per-member per-year. The report offers policy recommendations to
control and reduce insurer surpluses, including advising states to implement
minimum and maximum surplus ranges and forcing insurers to spend excessive
funds on state-prescribed expenses (Kaiser Health News, 7/22).
BCBS Plans Increased $4.5 Billion Since 2001:
An analysis by Consumers Union found that non-profit
Blue Cross Blue Shield (BCBS) health plans have collected billions in
surplus over the past decade while raising health care premiums. The report
notes that BCBS plans in 10 states (Alabama, Arizona, Massachusetts,
Michigan, New York, North Carolina, Oregon, Pennsylvania, Tennessee, and
Wyoming) held a collective $9.1 billion in surplus funds in 2009, or $855
per-member per-year. In 2001, those plans held $4.6 billion collectively, or
$395 per-member per-year. The report offers policy recommendations to
control and reduce insurer surpluses, including advising states to implement
minimum and maximum surplus ranges and forcing insurers to spend excessive
funds on state-prescribed expenses (Kaiser Health News, 7/22).
Tuesday, March 23, 2010
Health Care NOW is the Law of the Land
While driving to work this morning I listened to the health care reform bill signing ceremony taking place in the East Room of the White House. I couldn't help but reflect back to last August when I decided to write this blog. Initially writing the blog was an outlet for my frustration in fighting with insurance companies on behalf of our practice and on behalf of patients requiring health care. Overtime, writing this blog became a forum of legitimate debate, expression of concern for the less fortunate people of the United States of America not having access to health care, and whether or not health care should be treated as a commodity like orange juice or building supplies.
I have been privileged to hear from many of you passionately expressing your views or participating in this debate. Because of this blog I have had several interactions with Senators Boxer and Feinstein, and Representatives Sherman,Waxman, and Pelosi from California. I have been very critical of President Obama and the above named legislators for their inaction and unwillingness to stop corporate america from profiteering off the sick and or injured. I have expressed criticism to all of them for allowing the insurance industry, the medical device industry, and the pharmaceutical industry to drive health care and for taking their campaign contributions. I have publicly stated my opinion that all of them were more concerned about their re-election than they were about providing real access to health care and fixing our broken health care system.
I have also been very critical of the Senate Bill which did NOT go far enough in ensuring access to quality health care. I felt and still believe that the only solution to our broken health care system is universal health care with options for additional coverage (hybrid system). I felt and still believe that aspiring medical students should be educated and trained by our government in exchange for a minimum six year commitment to public health service with reasonable salary after they complete their residency and or fellowship training. I felt and still believe that corporations should NOT be part of the basic health care equation.
Frankly, I do not like this bill because the true beneficiary of this law is the insurance industry who now has over 30 million new customers without significant limitations on pricing. Anthem Blue Cross generated a $4.7 billion profit in the last quarter of 2009. At the same time letters were sent to individual policy holders in California informing them of up to 39% increase in their insurance premiums. Two weeks ago, the Dept of Insurance in California announced their findings of an investigation that Anthem Blue Cross committed 700 insurance violations. Each violation carries a $10,000 fine. This fine will be paid for by policy holders and the constant denial or delay of claims. Blue Cross doesn't care if they violate the rules because they will never pay fines from their profits. In other words, the Health Care Reform Bill signed today by President Obama will not stop the insurance industry from delaying payment or denying claims, raising insurance premiums, violating claims rules, or passing costs from their own negligence onto policy holders and health care providers.
That being said, the law that President Obama signed today is historic in that access to quality health care will now be available to tens of millions of people, who without this law, would go untreated. The law also provides that insurance companies may not deny coverage for people with pre existing conditions and they may not terminate coverage for sick or injured policy holders. Children up to age 26 will be allowed coverage under their parents policy. These are all good things.
As with all health care plans, the young and healthy support the elderly and the ill. Mandatory insurance for all Americans will help cover the costs of pre existing conditions. It won't solve all the economic impact of the legislation, but it will help. Opposition to the bill continues to deny this fact. The fear mongering promulgated by the opposition is a cover for the attitude of caring only about oneself and the continued profiteering off of sick people. As the new law infiltrates our society, the fear will subside when people come to terms with the reality of how little they will be personally effected (unless they don't have health care coverage or earn over $250,000 each year). This bill is NOT socialism. This bill does not take away our personal freedoms. This bill only makes it possible for people to get health care.
I agree with the President that this is a beginning. Concerns such as tort reform, education and training of health care providers, limiting profiteering off the sick or injured by the insurance industry, pharmaceutical industry, and medical device industry, and eliminating waste in providing health care MUST be continuously evaluated. Access to health care and solutions to these concerns will go a long way in FIXING OUR BROKEN HEALTH CARE SYSTEM.
Since Health Care NOW is the law of the land, this will be my last post on HEALTH CARE NOW. It has been a privilege to share my thoughts, concerns, and hopes with you all. I wish you good health.
I have been privileged to hear from many of you passionately expressing your views or participating in this debate. Because of this blog I have had several interactions with Senators Boxer and Feinstein, and Representatives Sherman,Waxman, and Pelosi from California. I have been very critical of President Obama and the above named legislators for their inaction and unwillingness to stop corporate america from profiteering off the sick and or injured. I have expressed criticism to all of them for allowing the insurance industry, the medical device industry, and the pharmaceutical industry to drive health care and for taking their campaign contributions. I have publicly stated my opinion that all of them were more concerned about their re-election than they were about providing real access to health care and fixing our broken health care system.
I have also been very critical of the Senate Bill which did NOT go far enough in ensuring access to quality health care. I felt and still believe that the only solution to our broken health care system is universal health care with options for additional coverage (hybrid system). I felt and still believe that aspiring medical students should be educated and trained by our government in exchange for a minimum six year commitment to public health service with reasonable salary after they complete their residency and or fellowship training. I felt and still believe that corporations should NOT be part of the basic health care equation.
Frankly, I do not like this bill because the true beneficiary of this law is the insurance industry who now has over 30 million new customers without significant limitations on pricing. Anthem Blue Cross generated a $4.7 billion profit in the last quarter of 2009. At the same time letters were sent to individual policy holders in California informing them of up to 39% increase in their insurance premiums. Two weeks ago, the Dept of Insurance in California announced their findings of an investigation that Anthem Blue Cross committed 700 insurance violations. Each violation carries a $10,000 fine. This fine will be paid for by policy holders and the constant denial or delay of claims. Blue Cross doesn't care if they violate the rules because they will never pay fines from their profits. In other words, the Health Care Reform Bill signed today by President Obama will not stop the insurance industry from delaying payment or denying claims, raising insurance premiums, violating claims rules, or passing costs from their own negligence onto policy holders and health care providers.
That being said, the law that President Obama signed today is historic in that access to quality health care will now be available to tens of millions of people, who without this law, would go untreated. The law also provides that insurance companies may not deny coverage for people with pre existing conditions and they may not terminate coverage for sick or injured policy holders. Children up to age 26 will be allowed coverage under their parents policy. These are all good things.
As with all health care plans, the young and healthy support the elderly and the ill. Mandatory insurance for all Americans will help cover the costs of pre existing conditions. It won't solve all the economic impact of the legislation, but it will help. Opposition to the bill continues to deny this fact. The fear mongering promulgated by the opposition is a cover for the attitude of caring only about oneself and the continued profiteering off of sick people. As the new law infiltrates our society, the fear will subside when people come to terms with the reality of how little they will be personally effected (unless they don't have health care coverage or earn over $250,000 each year). This bill is NOT socialism. This bill does not take away our personal freedoms. This bill only makes it possible for people to get health care.
I agree with the President that this is a beginning. Concerns such as tort reform, education and training of health care providers, limiting profiteering off the sick or injured by the insurance industry, pharmaceutical industry, and medical device industry, and eliminating waste in providing health care MUST be continuously evaluated. Access to health care and solutions to these concerns will go a long way in FIXING OUR BROKEN HEALTH CARE SYSTEM.
Since Health Care NOW is the law of the land, this will be my last post on HEALTH CARE NOW. It has been a privilege to share my thoughts, concerns, and hopes with you all. I wish you good health.
Sunday, March 21, 2010
House Amends Health Care Now only hours after passage
March 21, 2010 — It seemed like an anticlimax to the history that had just been made on the floor of the House of Representatives, but it was an anticlimax that mattered a lot politically to healthcare reformers in Washington, DC.
At roughly 10:45 pm EST, the House approved a Senate bill in a 219 to 212 vote that overhauls the nation's health system and extends insurance coverage to millions more Americans. Less than an hour later, the House amended that measure in a 220 to 211 vote to incorporate key changes sought by its own leadership as well as President Barack Obama.
The revisions to the Senate legislation appear in a budget reconciliation bill that lawmakers use to change revenue and spending lines in the federal budget. Casting those changes in the form of a reconciliation bill is important to congressional Democrats, because such a bill cannot be filibustered in the Senate, where Democrats lack the 60 votes needed to override a filibuster. The Senate is expected to vote on the reconciliation bill later this week to wrap up months of congressional debate on transforming one sixth of the nation's economy.
The Senate healthcare reform legislation that the House passed and then amended would, among other things, require most Americans to obtain health insurance, help needy individuals and families buy coverage through government-operated insurance "exchanges," prevent private insurers from denying someone a policy based on preexisting conditions, and increase Medicaid enrollment by almost 50%.
Amendments Include Medicaid Pay Raise for Primary-Care Physicians
The amendments approved today do not alter the basic framework of the Senate healthcare reform bill, but they do introduce significant embellishments, some key to the measure's passage. The reconciliation bill would:
Add 16 million additional Americans to the Medicaid program compared with 15 million under the Senate plan, and raise Medicaid reimbursement rates to Medicare levels for general internists, family physicians, and pediatricians in 2013 and 2014.
Eliminate a special deal for Nebraska that would have exempted it from funding its share of an expanded state Medicaid program, and instead beef up federal Medicaid funding for all states.
Eventually close the "doughnut hole" in the Medicare Part D prescription drug plan, a coverage gap that forces Medicare recipients to bear the full cost of medications.
Make steeper cuts in payments to private Medicare Advantage plans.
Levy a 3.8% Medicare Part A (hospital insurance) tax on unearned income for individuals who earn more than $200,000 ($250,000 for married couples). This comes on top of a 0.9% increase in the Medicare Part A tax on earned income for these individuals and couples under the Senate bill.
Delay the effective date of an excise tax on high-cost insurance plans from 2013 to 2018, and increase dollar thresholds for insurance costs that are subject to the tax.
Offer more generous subsidies to individuals and families purchasing required insurance coverage.
When the reconciliation amendments are incorporated, the Senate bill translates into health insurance coverage for 32 million additional Americans over 10 years at a cost of $938 billion while reducing the federal deficit by $143 billion during that period, according to the Congressional Budget Office.
While the reconciliation bill must now receive Senate approval before the amendments take effect, the Senate bill itself — now approved by the House — will go to President Obama for his signature, according to a game plan for today's votes published on the Web site of House Majority Leader Steny Hoyer (D-MD).
[CLOSE WINDOW]
Authors and Disclosures
Journalist
Robert Lowes
Freelance writer, St. Louis, Missouri
Disclosure: Robert L. Lowes has disclosed no relevant financial relationships.
At roughly 10:45 pm EST, the House approved a Senate bill in a 219 to 212 vote that overhauls the nation's health system and extends insurance coverage to millions more Americans. Less than an hour later, the House amended that measure in a 220 to 211 vote to incorporate key changes sought by its own leadership as well as President Barack Obama.
The revisions to the Senate legislation appear in a budget reconciliation bill that lawmakers use to change revenue and spending lines in the federal budget. Casting those changes in the form of a reconciliation bill is important to congressional Democrats, because such a bill cannot be filibustered in the Senate, where Democrats lack the 60 votes needed to override a filibuster. The Senate is expected to vote on the reconciliation bill later this week to wrap up months of congressional debate on transforming one sixth of the nation's economy.
The Senate healthcare reform legislation that the House passed and then amended would, among other things, require most Americans to obtain health insurance, help needy individuals and families buy coverage through government-operated insurance "exchanges," prevent private insurers from denying someone a policy based on preexisting conditions, and increase Medicaid enrollment by almost 50%.
Amendments Include Medicaid Pay Raise for Primary-Care Physicians
The amendments approved today do not alter the basic framework of the Senate healthcare reform bill, but they do introduce significant embellishments, some key to the measure's passage. The reconciliation bill would:
Add 16 million additional Americans to the Medicaid program compared with 15 million under the Senate plan, and raise Medicaid reimbursement rates to Medicare levels for general internists, family physicians, and pediatricians in 2013 and 2014.
Eliminate a special deal for Nebraska that would have exempted it from funding its share of an expanded state Medicaid program, and instead beef up federal Medicaid funding for all states.
Eventually close the "doughnut hole" in the Medicare Part D prescription drug plan, a coverage gap that forces Medicare recipients to bear the full cost of medications.
Make steeper cuts in payments to private Medicare Advantage plans.
Levy a 3.8% Medicare Part A (hospital insurance) tax on unearned income for individuals who earn more than $200,000 ($250,000 for married couples). This comes on top of a 0.9% increase in the Medicare Part A tax on earned income for these individuals and couples under the Senate bill.
Delay the effective date of an excise tax on high-cost insurance plans from 2013 to 2018, and increase dollar thresholds for insurance costs that are subject to the tax.
Offer more generous subsidies to individuals and families purchasing required insurance coverage.
When the reconciliation amendments are incorporated, the Senate bill translates into health insurance coverage for 32 million additional Americans over 10 years at a cost of $938 billion while reducing the federal deficit by $143 billion during that period, according to the Congressional Budget Office.
While the reconciliation bill must now receive Senate approval before the amendments take effect, the Senate bill itself — now approved by the House — will go to President Obama for his signature, according to a game plan for today's votes published on the Web site of House Majority Leader Steny Hoyer (D-MD).
[CLOSE WINDOW]
Authors and Disclosures
Journalist
Robert Lowes
Freelance writer, St. Louis, Missouri
Disclosure: Robert L. Lowes has disclosed no relevant financial relationships.
Congress Passes HEALTH CARE NOW
March 21, 2010 — The great healthcare reform battle of 2009 and 2010, for the most part, is over.
Congressional Democrats today finally passed their bill.
The only thing it needs now is the signature of President Barack Obama to become the law of the land.
In a 219 to 212 vote, the House today approved a bill enacted by the Senate last December that represents the most sweeping government initiative in healthcare since the creation of Medicare and Medicaid in 1965.
Most notably, the legislation will require most Americans to acquire health insurance, help cash-strapped individuals and families purchase it through government-operated insurance marketplaces called exchanges, increase Medicaid enrollment by almost 50%, and impose regulations on private insurers that would prevent them from denying someone coverage based on preexisting conditions.
After the historic vote, the House is expected to turn today to a budget reconciliation bill that would amend the now-approved Senate bill more to the House's and the president's liking. Taken together with this reconciliation bill, the Senate reform package would extend insurance coverage to 32 million more Americans over 10 years at a cost of $938 billion, although it would reduce the federal deficit during that period by $143 billion, according to the latest estimates of the Congressional Budget Office (a few days ago, the CBO had released slightly different dollar amounts).
If approved by the House, the budget reconciliation bill will go before the Senate, where Senate Majority Leader Harry Reid (D-NV) says he has the minimum 51 votes required to pass it. Reconciliation bills — which adjust revenue and spending lines in the federal budget — cannot be filibustered in the Senate. It takes 60 votes in the Senate to override the endless speeches and procedural motions that characterize a filibuster and force a vote on legislation. Republican Senators, who unanimously opposed the reform bill approved by their chamber last year, command 41 votes.
Today's House Vote Makes History in More Ways Than One
In addition to dramatically reshaping the American healthcare system — which accounts for one sixth of the nation's economy — the legislation passed by the House today was historic for other reasons. For the first time, the American Medical Association supported a plan for government-orchestrated healthcare reform after having denounced earlier proposals, including legislation creating Medicare and Medicaid, as dangerous experiments in "socialized medicine." Other major medical societies that backed today's bill were the American College of Physicians and the American Academy of Pediatrics.
The fear of federalization still resonated, though, among Republican politicians who formed a thick stone wall against the legislation. Their arguments against what they called a government takeover of medicine at times reached rhetorical fever pitches that will be remembered for years.
Sarah Palin, the former governor of Alaska and the Republican vice presidental candidate last year, warned that under the Democrats' reform plan, bureaucratic "death panels" would deny care to the disabled and elderly in the name of cost-saving. Even though the likes of the AARP called these claims unfounded, the debate about complex healthcare policy soon featured the catch-phrase "pulling the plug on granny."
At the same time, the new Tea Party movement entered the fray, holding rallies, flooding congressional townhall meetings, and wavings signs with messages such as "Save Granny. Defeat Obamacare" and "Get Government Out of Our Lives." Such protesters showed up today in force in Washington, DC, as the House casts its vote.
Fiery denunciations of reform legislation also resounded inside the Capitol building up until the time of the vote.
"My colleagues are celebrating the birth of a great new entitlement program," said Rep. Marsha Blackburn (R-TN). "Only they see dependency on the federal government and the death of freedom as a cause for celebration. Freedom dies a little bit today."
Last-Minute Promise of Executive Order Against Abortion Funding Secured Key Votes
One obstacle to House Democrats rounding up enough votes for victory was the issue of federal funding of abortions in an overhauled healthcare system.
When House Democrats crafted and passed their own reform bill last year, they included language that would prohibit any woman receiving an insurance premium subsidy from purchasing a health plan that covered an abortion other than a federally sanctioned one to save the life of the woman or in cases of rape and incest. The Senate bill contains a complicated anti-abortion restriction that resembles the House version in intent, but Democratic reform advocates in the House like Rep. Bart Stupak (D-MI) who are also abortion opponents said the Senate language was not strong enough for them to support the bill in good conscience.
Earlier today, President Obama convinced Rep. Stupak and his coalition of like-minded Democrats to change their votes to "Yea" by promising to issue an executive order that would ensure no abortions would be federally funded under the reform bill before the House on Sunday. President Obama released the text of the order and said he would sign it as soon as the House passed the bill.
It was good enough for Rep. Stupak.
"We've been able to come to an agreement to protect the sanctity of life in healthcare reform," Rep. Stupak said Sunday.
Two Medical Societies Applaud Reform Bill, But Say More Legislative Work Remains
In a press release issued tonight, American Medical Association President J. James Rohack, MD, said that by extending health insurance to millions more Americans, the bill passed by the House "will help patients and the physicians who care for them."
"Every day physicians see the devastating effect being uninsured has on the health of our patients," Dr. Rohack said. "Physicians dedicate their lives to helping patients, and we have an historic opportunity now to do just that."
Similarly, Lori Heim, MD, the president of the American Academy of Family Physicians, hailed the bill's passage in a written statement. "As a result of today's vote, Americans can look forward to health security because they soon will have the chance to buy health insurance that meets their needs without emptying their bank accounts," Dr. Heim stated.
Both Dr. Heim and Dr. Rohack said that their societies will continue to work with Congress on what they see as the unfinished business of healthcare reform, particularly medical liability reform and a permanent solution to the problematic formula for setting Medicare reimbursement for physicians, which calls for a 21.2% pay cut this year.
[CLOSE WINDOW]
Authors and Disclosures
Journalist
Robert Lowes
Freelance writer, St. Louis, Missouri
Disclosure: Robert L. Lowes has disclosed no relevant financial relationships.
Congressional Democrats today finally passed their bill.
The only thing it needs now is the signature of President Barack Obama to become the law of the land.
In a 219 to 212 vote, the House today approved a bill enacted by the Senate last December that represents the most sweeping government initiative in healthcare since the creation of Medicare and Medicaid in 1965.
Most notably, the legislation will require most Americans to acquire health insurance, help cash-strapped individuals and families purchase it through government-operated insurance marketplaces called exchanges, increase Medicaid enrollment by almost 50%, and impose regulations on private insurers that would prevent them from denying someone coverage based on preexisting conditions.
After the historic vote, the House is expected to turn today to a budget reconciliation bill that would amend the now-approved Senate bill more to the House's and the president's liking. Taken together with this reconciliation bill, the Senate reform package would extend insurance coverage to 32 million more Americans over 10 years at a cost of $938 billion, although it would reduce the federal deficit during that period by $143 billion, according to the latest estimates of the Congressional Budget Office (a few days ago, the CBO had released slightly different dollar amounts).
If approved by the House, the budget reconciliation bill will go before the Senate, where Senate Majority Leader Harry Reid (D-NV) says he has the minimum 51 votes required to pass it. Reconciliation bills — which adjust revenue and spending lines in the federal budget — cannot be filibustered in the Senate. It takes 60 votes in the Senate to override the endless speeches and procedural motions that characterize a filibuster and force a vote on legislation. Republican Senators, who unanimously opposed the reform bill approved by their chamber last year, command 41 votes.
Today's House Vote Makes History in More Ways Than One
In addition to dramatically reshaping the American healthcare system — which accounts for one sixth of the nation's economy — the legislation passed by the House today was historic for other reasons. For the first time, the American Medical Association supported a plan for government-orchestrated healthcare reform after having denounced earlier proposals, including legislation creating Medicare and Medicaid, as dangerous experiments in "socialized medicine." Other major medical societies that backed today's bill were the American College of Physicians and the American Academy of Pediatrics.
The fear of federalization still resonated, though, among Republican politicians who formed a thick stone wall against the legislation. Their arguments against what they called a government takeover of medicine at times reached rhetorical fever pitches that will be remembered for years.
Sarah Palin, the former governor of Alaska and the Republican vice presidental candidate last year, warned that under the Democrats' reform plan, bureaucratic "death panels" would deny care to the disabled and elderly in the name of cost-saving. Even though the likes of the AARP called these claims unfounded, the debate about complex healthcare policy soon featured the catch-phrase "pulling the plug on granny."
At the same time, the new Tea Party movement entered the fray, holding rallies, flooding congressional townhall meetings, and wavings signs with messages such as "Save Granny. Defeat Obamacare" and "Get Government Out of Our Lives." Such protesters showed up today in force in Washington, DC, as the House casts its vote.
Fiery denunciations of reform legislation also resounded inside the Capitol building up until the time of the vote.
"My colleagues are celebrating the birth of a great new entitlement program," said Rep. Marsha Blackburn (R-TN). "Only they see dependency on the federal government and the death of freedom as a cause for celebration. Freedom dies a little bit today."
Last-Minute Promise of Executive Order Against Abortion Funding Secured Key Votes
One obstacle to House Democrats rounding up enough votes for victory was the issue of federal funding of abortions in an overhauled healthcare system.
When House Democrats crafted and passed their own reform bill last year, they included language that would prohibit any woman receiving an insurance premium subsidy from purchasing a health plan that covered an abortion other than a federally sanctioned one to save the life of the woman or in cases of rape and incest. The Senate bill contains a complicated anti-abortion restriction that resembles the House version in intent, but Democratic reform advocates in the House like Rep. Bart Stupak (D-MI) who are also abortion opponents said the Senate language was not strong enough for them to support the bill in good conscience.
Earlier today, President Obama convinced Rep. Stupak and his coalition of like-minded Democrats to change their votes to "Yea" by promising to issue an executive order that would ensure no abortions would be federally funded under the reform bill before the House on Sunday. President Obama released the text of the order and said he would sign it as soon as the House passed the bill.
It was good enough for Rep. Stupak.
"We've been able to come to an agreement to protect the sanctity of life in healthcare reform," Rep. Stupak said Sunday.
Two Medical Societies Applaud Reform Bill, But Say More Legislative Work Remains
In a press release issued tonight, American Medical Association President J. James Rohack, MD, said that by extending health insurance to millions more Americans, the bill passed by the House "will help patients and the physicians who care for them."
"Every day physicians see the devastating effect being uninsured has on the health of our patients," Dr. Rohack said. "Physicians dedicate their lives to helping patients, and we have an historic opportunity now to do just that."
Similarly, Lori Heim, MD, the president of the American Academy of Family Physicians, hailed the bill's passage in a written statement. "As a result of today's vote, Americans can look forward to health security because they soon will have the chance to buy health insurance that meets their needs without emptying their bank accounts," Dr. Heim stated.
Both Dr. Heim and Dr. Rohack said that their societies will continue to work with Congress on what they see as the unfinished business of healthcare reform, particularly medical liability reform and a permanent solution to the problematic formula for setting Medicare reimbursement for physicians, which calls for a 21.2% pay cut this year.
[CLOSE WINDOW]
Authors and Disclosures
Journalist
Robert Lowes
Freelance writer, St. Louis, Missouri
Disclosure: Robert L. Lowes has disclosed no relevant financial relationships.
Thursday, February 25, 2010
House votes to repeal anti trust exemption for insurance companies
February 24, 2010 — In a rare display of bipartisan unity, the US House of
Representatives this afternoon passed, by a lopsided vote of 406 to 19,
legislation that would end health insurance companies' 65-year exemption
from a variety of federal antitrust rules.
Supporters of the bill — the Health Insurance Industry Fair Competition Act,
which would repeal portions of the McCarran-Ferguson Act, passed in 1945 —
argue that it will restore competition to the health insurance market, which
surveys have shown has become increasingly dominated in many areas by 1 or 2
insurers.
"It's time for Washington to decide whether we stand with patients or
profiteering, whether we believe in market competition or a collusion
between politicians and insurance companies," said freshman bill cosponsor
Rep. Tom Perriello (D-VA) in the run-up to the vote.
But skeptics, many in the GOP, charge that the repeal will have a negligible
effect on premiums and that it will do little to address the consolidation
issue — in fact, the Federal Trade Commission and the Department of Justice
already have the authority to examine the antitrust implications of health
insurer mergers and acquisitions.
Citing the Congressional Budget Office, which predicted a small effect on
premiums because states already had laws on their books that outlaw
practices that would be prohibited under the bill, including bid rigging and
price fixing, Rep. Lamar Smith (R-TX) argued during floor debate that "some
may wish upon a star, but this bill is a dim bulb."
Still, dim bulb or not, most House Republicans were not inclined to buck the
popular backlash against insurance companies and vote against the bill.
Some Republicans who ended up voting for the bill nevertheless argued during
the procedural portion of the debate for its amendment. Among other things,
they argued for an amendment that would permit insurance companies to share
historical loss data and actuarial services — a provision, they said, that
would be especially beneficial to smaller insurance companies. The
resolution barring amendments prevailed, however, and Republicans such as
Rep. Dan Lungren of California used a portion of their floor time to argue
for what they say would be more effective cost-control legislation — medical
malpractice reform.
The bill will not affect property and casualty insurers, including medical
malpractice carriers, which will maintain their antitrust exemptions.
Action now moves to the Senate, where the measure may need a supermajority
of at least 60 votes to move forward.
Representatives this afternoon passed, by a lopsided vote of 406 to 19,
legislation that would end health insurance companies' 65-year exemption
from a variety of federal antitrust rules.
Supporters of the bill — the Health Insurance Industry Fair Competition Act,
which would repeal portions of the McCarran-Ferguson Act, passed in 1945 —
argue that it will restore competition to the health insurance market, which
surveys have shown has become increasingly dominated in many areas by 1 or 2
insurers.
"It's time for Washington to decide whether we stand with patients or
profiteering, whether we believe in market competition or a collusion
between politicians and insurance companies," said freshman bill cosponsor
Rep. Tom Perriello (D-VA) in the run-up to the vote.
But skeptics, many in the GOP, charge that the repeal will have a negligible
effect on premiums and that it will do little to address the consolidation
issue — in fact, the Federal Trade Commission and the Department of Justice
already have the authority to examine the antitrust implications of health
insurer mergers and acquisitions.
Citing the Congressional Budget Office, which predicted a small effect on
premiums because states already had laws on their books that outlaw
practices that would be prohibited under the bill, including bid rigging and
price fixing, Rep. Lamar Smith (R-TX) argued during floor debate that "some
may wish upon a star, but this bill is a dim bulb."
Still, dim bulb or not, most House Republicans were not inclined to buck the
popular backlash against insurance companies and vote against the bill.
Some Republicans who ended up voting for the bill nevertheless argued during
the procedural portion of the debate for its amendment. Among other things,
they argued for an amendment that would permit insurance companies to share
historical loss data and actuarial services — a provision, they said, that
would be especially beneficial to smaller insurance companies. The
resolution barring amendments prevailed, however, and Republicans such as
Rep. Dan Lungren of California used a portion of their floor time to argue
for what they say would be more effective cost-control legislation — medical
malpractice reform.
The bill will not affect property and casualty insurers, including medical
malpractice carriers, which will maintain their antitrust exemptions.
Action now moves to the Senate, where the measure may need a supermajority
of at least 60 votes to move forward.
Wednesday, February 24, 2010
Back by popular demand. First Blog post August 8, 2009
President Obama called for a bipartisan health care summit that begins tomorrow, February 25, 2010. I have heard from several readers of this blog to re-post my first entry. Enjoy AGAIN
Saturday, August 8, 2009
Welcome to Health Care Now. This Blog is dedicated to fixing a very broken health care system in the USA.
There can be no real health care reform without insurance and pharmaceutical industry reform. Health Insurance and Pharmaceutical Companies DO NOT PROVIDE HEALTH CARE. These companies are in busines to make money for their shaeholders and executives. Check this out!
UnitedHealth CEO
Stephen J. Hemsley
2007 Compensation
$13.2 million
2008 Compensation (Forbes)
$3,241,042
Former Managing Partner and CFO of Arthur Andersen (BusinessWeek)
Total Value of Unexercised Stock Options (Forbes)
$744,232,068
2009 Options Exercise
$127,001,281
Value of Wayzata, Minnesota Home (Hennepin County Assessor)
$6,640,000
Articles:
Hemsley returns $190 million in stock options acquired as a result of practices found to be fraudulent by the SEC (American Medical News)
CIGNA CEO
Edward Hanway
Five-Year Compensation, as of April 30, 2008 (Forbes)
$120.51 million
Total Value of Unexercised Stock Options (Forbes)
$28,881,000
Value of New Jersey Beach Home (Cape May County Assessor)
$13,607,400
Articles:
The family of a 17-year-old girl who died hours after CIGNA reversed a decision and said it would pay for a liver transplant plans to sue the company, their attorney said Friday.
Hundreds of entertainment industry workers in California and New Jersey who buy health insurance as a group are being hit with a rate increase that will raise some family-plan premiums to more than $44,000 a year.
Humana CEO
Michael McCallister
2007 Compensation
$10.3 million
2008 Compensation (Forbes)
$1,017,308
Five-Year Compensation Total (Forbes)
$15.1 million
Total Value of Unexercised Stock Options (Forbes)
$60,865,194
2006 Options Exercise (SECForm4)
$22,294,710
Value of Park City, Utah Home (County Assessor)
$6,978,380
Articles:
Humana abandons senior citizens in Florida, returns after Republicans pass new Medicare law, upping HMO payments by ~ 25% (NY Times)
Aetna CEO
Ronald A. Williams
2007 Compensation
$23 million
2008 Compensation (Forbes)
$24,300,112
Total Value of Unexercised Options (Forbes)
$194,496,797
Williams is in the top ten of Forbes'"$100 Million CEO Club."
Articles:
Health insurance giants Aetna and CIGNA, along with others, became the latest targets of a wide-ranging probe launched by New York Attorney General Eliot Spitzer, according to USA Today. (source)
Coventry CEO
Allen Wise
CEO from 1996-2004, and from January 2009-Present
2004 Compensation (Forbes)
$13,052,799
2006 Sale of Stock
$14,458,251
2006 Options Exercised
$2,895,000
2005 Sale of Stock
$46,410,695
2005 Options Exercised
$6,709,564
2004 Sale of Stock
$12,826,756
2004 Options Exercised
$4,798,000
Value of Hilton Head, SC Home (Beaufort County Assessor)
$3,275,500
WellPoint CEO
Angela Braly
2007 Compensation (secinfo)
$9,094,271
2008 Compensation (Forbes)
$9,844,212
2006 Sale of Stock (SECForm4)
$4,858,585
2006 Options Excerise (SECForm4)
$4,566,124
Value of Indianapolis Home
$1,987,700
This is just a handful of health insurance executives. None of these people have ever diagnosed or treated any patient in their executive capacity. In fact, they participate in developing company policy that limits health care to their policy holders and in many cases deny health care to their policy holders. Withholding funding for health care is how these obscene salaries are paid.
Remove health insurance companies from the equation and all this money could actually be used to provide health care for those in need.
Posted by Doc at 5:41 AM
Saturday, August 8, 2009
Welcome to Health Care Now. This Blog is dedicated to fixing a very broken health care system in the USA.
There can be no real health care reform without insurance and pharmaceutical industry reform. Health Insurance and Pharmaceutical Companies DO NOT PROVIDE HEALTH CARE. These companies are in busines to make money for their shaeholders and executives. Check this out!
UnitedHealth CEO
Stephen J. Hemsley
2007 Compensation
$13.2 million
2008 Compensation (Forbes)
$3,241,042
Former Managing Partner and CFO of Arthur Andersen (BusinessWeek)
Total Value of Unexercised Stock Options (Forbes)
$744,232,068
2009 Options Exercise
$127,001,281
Value of Wayzata, Minnesota Home (Hennepin County Assessor)
$6,640,000
Articles:
Hemsley returns $190 million in stock options acquired as a result of practices found to be fraudulent by the SEC (American Medical News)
CIGNA CEO
Edward Hanway
Five-Year Compensation, as of April 30, 2008 (Forbes)
$120.51 million
Total Value of Unexercised Stock Options (Forbes)
$28,881,000
Value of New Jersey Beach Home (Cape May County Assessor)
$13,607,400
Articles:
The family of a 17-year-old girl who died hours after CIGNA reversed a decision and said it would pay for a liver transplant plans to sue the company, their attorney said Friday.
Hundreds of entertainment industry workers in California and New Jersey who buy health insurance as a group are being hit with a rate increase that will raise some family-plan premiums to more than $44,000 a year.
Humana CEO
Michael McCallister
2007 Compensation
$10.3 million
2008 Compensation (Forbes)
$1,017,308
Five-Year Compensation Total (Forbes)
$15.1 million
Total Value of Unexercised Stock Options (Forbes)
$60,865,194
2006 Options Exercise (SECForm4)
$22,294,710
Value of Park City, Utah Home (County Assessor)
$6,978,380
Articles:
Humana abandons senior citizens in Florida, returns after Republicans pass new Medicare law, upping HMO payments by ~ 25% (NY Times)
Aetna CEO
Ronald A. Williams
2007 Compensation
$23 million
2008 Compensation (Forbes)
$24,300,112
Total Value of Unexercised Options (Forbes)
$194,496,797
Williams is in the top ten of Forbes'"$100 Million CEO Club."
Articles:
Health insurance giants Aetna and CIGNA, along with others, became the latest targets of a wide-ranging probe launched by New York Attorney General Eliot Spitzer, according to USA Today. (source)
Coventry CEO
Allen Wise
CEO from 1996-2004, and from January 2009-Present
2004 Compensation (Forbes)
$13,052,799
2006 Sale of Stock
$14,458,251
2006 Options Exercised
$2,895,000
2005 Sale of Stock
$46,410,695
2005 Options Exercised
$6,709,564
2004 Sale of Stock
$12,826,756
2004 Options Exercised
$4,798,000
Value of Hilton Head, SC Home (Beaufort County Assessor)
$3,275,500
WellPoint CEO
Angela Braly
2007 Compensation (secinfo)
$9,094,271
2008 Compensation (Forbes)
$9,844,212
2006 Sale of Stock (SECForm4)
$4,858,585
2006 Options Excerise (SECForm4)
$4,566,124
Value of Indianapolis Home
$1,987,700
This is just a handful of health insurance executives. None of these people have ever diagnosed or treated any patient in their executive capacity. In fact, they participate in developing company policy that limits health care to their policy holders and in many cases deny health care to their policy holders. Withholding funding for health care is how these obscene salaries are paid.
Remove health insurance companies from the equation and all this money could actually be used to provide health care for those in need.
Posted by Doc at 5:41 AM
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