[Marxism] Insurers Ease Stance on Pre-Existing Conditions
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Wed Mar 25 07:56:03 MDT 2009
March 25, 2009
Insurers Ease Stance on Pre-Existing Conditions
By ROBERT PEAR
WASHINGTON —The health insurance industry said Tuesday that it was
willing to end the practice of charging higher premiums to sick people
if Congress adopted a comprehensive plan that provided coverage to all
The industry’s flexible position on the issue came as a surprise to
lawmakers, and could make it easier to reach an agreement in Congress
because it narrows the issues on which insurers are ready to fight the
Democrats who control Congress and the White House.
Insurers said they were still staunchly opposed to creation of a new
government-run health insurance plan, which, under many Democratic
proposals, would compete directly with private insurers.
In effect, insurers said they were willing to discard an element of
their longstanding business model, under which insurance policies are
priced, in part, on the basis of a person’s medical condition or
In the past, insurers have warned that if they could not consider a
person’s health in setting premiums, the rates charged to young,
healthy people would soar, making coverage unaffordable.
But Karen M. Ignagni, president of America’s Health Insurance Plans, a
major trade group, told lawmakers on Tuesday that insurers were
exploring ideas to prevent such increases by spreading the risks and
costs across a larger population of both healthy and unhealthy people.
Insurers said that they could accept more aggressive regulation of not
just their premiums but also their benefits, underwriting practices
and other activities. Such strict regulation, they said, would make a
new public program unnecessary.
The insurers set forth their position at a Senate hearing on Tuesday
and in letters to the Democratic chairmen and senior Republican
members of the two Senate committees primarily responsible for health
The letters were signed by Ms. Ignagni and Scott P. Serota, president
of the Blue Cross and Blue Shield Association.
Senator Jeff Bingaman, Democrat of New Mexico, who presided over the
hearing, welcomed the insurers’ position.
“It was a significant step for them to take,” Mr. Bingaman said in an
interview. “That’s certainly not been their position in previous
years. I hope it moves us closer to something that we could label a
Senator Max Baucus, the Montana Democrat who is chairman of the
Finance Committee, also welcomed the insurers’ stance. “It indicates
that we may be able to have health care reform this year because the
major players are stepping up and saying they are willing to play,”
Mr. Baucus said.
Sandy Praeger, the Kansas insurance commissioner, who testified
Tuesday on behalf the National Association of Insurance Commissioners,
said the companies were taking “a very good step in the right
“As we move toward getting everybody covered,” Ms. Praeger said, “we
have to get rid of health status as a rating factor.”
Regulation of premiums in the individual insurance market varies among
states. Premiums for a person with a history of serious illness are
often 50 percent higher than premiums for younger, healthier people —
if the sick people can get coverage at all, she said.
In November, two weeks after the presidential election, the industry
said it could support legislation requiring insurers to accept all
applicants, regardless of illness or disability. In return, the
industry said, Congress should require all Americans to have coverage.
At that time, the industry pointedly refused to say whether it would
accept stricter regulation of its rates, to limit the variation in
In their letter to Congress, Ms. Ignagni and Mr. Serota said that if
Congress enacted an enforceable requirement for everyone to carry
health insurance, “we could guarantee issue of coverage with no
pre-existing condition exclusions and phase out the practice of
varying premiums based on health status in the individual market.”
However, the two executives said that insurers wanted to retain the
right to charge different premiums based on the age, place of
residence and family size of subscribers.
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