A trojan horse for health insurers-- create a basic insurance policy with premium caps

[andym]

Health insurers are salivating over the possibility of 40 million new customers without competition. The only fear they apparently have is that a strong public option might pass Congress. I sincerely hope that a strong public option passes (single payer would be even better...) However, the number of moderates and conservatives in Congress is a problem.

Here, I suggest another way to get the US on the fast track to single-payer and at the same time create a trojan horse for any insurer who would like to get any of the new paying customers. Most will pass on this offer, which will require the creation of a Medicare like government program or the expansion of Medicare.

Here is a copy of a letter that I've sent to some of the key Senators involved in health care reform:

Dear Senator X,

I would like to suggest a low cost way to achieve Universal Health care insurance reform that may be
acceptable to a majority of your colleagues, because it relies only on creating new regulations. The key idea is to cap premiums and create a basic health insurance plan.

The proposal requires any insurance company that participates in the new exchange to offer a basic insurance
policy that includes the following:

1) insurance is open to everyone.

2) no exclusions for pre-existing conditions.

3) pricing is independent of age.

4) benefits at least equivalent to Medicare-- use Medicare as a guide to determine which procedures must be
performed-- this is to remedy the high claim rejection rate recently reported by major insurers in California.

5) premiums capped at a fixed percentage above Medicare costs based on an average person receiving average amount of health care per year.

Companies offering this basic plan would get to pay Medicare rates to providers for services rendered to patients choosing this plan.

The fixed percentage for premiums (for example 10% above Medicare rate) would represent overhead from which their profits (if any) would be obtained.

6) total out of pocket costs capped as already determined in pending bills before Congress.

7) government negotiated rate for pharmaceuticals (with drug companies) for insurers offering this basic plan -- this would hold down increasing costs due to increasing price of pharmaceuticals.

8) all emergencies covered (including out of network) to prevent "balance billing" (not addressed by current
pending bills).

9) subsidies for the poor. (most of the cost for this proposal would be for this)

10) If insufficient number of insurance companies offer this policy, then a government plan should be offered to implement it.

Capping premiums for this basic plan is the key to make this work. Insurance companies would compete to hold prices down as their profit would be limited to the fixed percentage premium cap. In essence, the private insurance companies that would like to have a share of the new customers in the exchange would have to offer a Medicare-like insurance policy at reasonable cost. Companies would be free to offer whatever other insurance policies they would like, but not have access to the same provider payment rates as for the basic plan.

My own preference in order of desirability is that Congress pass HR676 Medicare for All, Congress pass a
Strong Public Option, or Congress allow people under 65 to optionally buy into Medicare (eg 55-64 year olds).
However, a plan such as the one proposed within this letter may achieve many of the same goals with the lowest
cost and greatest political acceptance.

The USA now spends 16% of GDP on health care making US-based companies and workers uncompetitive with those from most other industrialized nations. Furthermore the USA leaves 40 million people uncovered and numerous others subject to claim rejection by insurance companies. Serious health care reform is a necessity. The ideas presented here may be of some practical help in achieving true reform.

[andym]

1. Caps are a simple solution to many problems resulting from corporate overreach: cc interest rates

Caps are a simple solution to many problems resulting from corporate overreach-- besides the climate cap bill, credit card interest rates are in need of capping as well.

[andym]

2. In light of the President's speech, perhaps someone will be open to increasing regulation n/t