Tuesday, August 18, 2009

The Need for Health Reform

Lest anyone misinterpret my previous blogs, I believe that our system is desperately in need of reform.  As I read President Obama’s opinion piece in the Sunday New York Times this weekend, I strongly agreed with some of the arguments he put forth to support health reform.  He highlighted a number of issues that are important to address in any health reform package and HR 3200 does effectively address those. 

Pre-existing Conditions Clauses

In that article, President Obama wrote “A 2007 national survey actually shows that insurance companies discriminated against more than 12 million Americans in the previous three years because they had a pre-existing illness or condition. The companies either refused to cover the person, refused to cover a specific illness or condition or charged a higher premium.”  While I would argue with the word “discriminate” as companies that do not discriminate and cover those with pre-existing conditions would have to charge higher premiums and would not be able to continue in business, the ability to exclude someone because of a pre-existing condition has been problematic for years.  If you speak to health insurance executives, they will tell you that they maintain those clauses in order to keep premiums low for select groups.  If you eliminate pre-existing conditions clauses, rates for many policies, especially individual and small group policies will go up.  Despite that I still believe that these clauses should be outlawed as they go against the basic premise of shared financial risk that is inherent in good insurance.  HR 3200, in Title I, Subtitle B, Section 111 does prohibit pre-existing condition exclusions and I see that as very positive. 

Policy Maximums

In that same article, President Obama states “They will no longer be able to place some arbitrary cap on the amount of coverage you can receive in a given year or in a lifetime. And we will place a limit on how much you can be charged for out-of-pocket expenses. No one in America should go broke because they get sick.”  What he is referring to in this quote is the yearly and lifetime maximums that some policies have in place.  A policy may now state that over the entire lifetime of the policy, it will only pay to a maximum of 1 million or 2 million or 5 million dollars and after that the benefits stop.  Obviously, if you have a severely catastrophic illness and go over that cap, you have no recourse other than some sort of public program.  Here again, eliminating these maximums will increase premiums for everyone, especially those who have individual policies and policies through small businesses.  However I am in agreement that this is needed to prevent people from compounding their illness with severe financial distress.  Section 122 of the same section of the bill that I cite above states that insurance coverage “does not impose any annual or lifetime limit on the coverage of covered health care items and services”  I see that as a plus and a needed change in law. 

Pass Those Clauses Now

There is really no reason that our legislators cannot pass these two sections now as a separate law.  There is no rule that makes all of the pieces of this legislation fit together.  We can find agreement for individual parts of the bill and I only hope that we can find the political will to make those changes that are needed.