Tuesday, July 8, 2008

Despite What You Think, Health Insurers Are NOT Opposed to Reform

Even persons with a passing familiarity with Shakespeare will recognize the famous quote taken from the speech of the usurer Shylock in which he asks ‘If you prick us, do we not bleed?’ The May/June issue of Health Affairs article by Bruce Bodaken, Chair and CEO of California Blue Shield reminded the Disease Management Care Blog of the hapless reviled money lender, who has the letter of contract law on his side but still struggles to gain much respect or sympathy.

M. Bodaken's central theme is that, contrary to conventional wisdom, the health insurance industry is not, repeat not, opposed to reform. In fact, local insurers were supportive in both Massachusetts’ and California’s efforts (and, by the way, in Pennsylvania). As expected, he notes health insurers are leery about ‘big bang’ proposals (versus incremental change) and mandates (versus flexible participation). However, there are “pockets of support in the industry” for even the far reaching liberal reforms.

How to maximize insurance industry support come January 20, 2009 when the next President assumes office? Mr Bodaken offers a common sensical six point guide which is summarized below

Respect the economics – financial viability is important.

Embrace competition – level the playing field and emphasize quality, service and cost effectiveness.

Manage the transition – don’t just pass a law and assume the job is done.

Respect the insurers’ expertise – market dynamics, actuarial expertise and strategy are not the exclusive province of lawmakers and policy makers.

Share the responsibility – everyone will need to sacrifice something

Stop demonizing health plans – it’s not the insurers’ fault.

But the DMCB couldn't help itself. With apologies to The Bard. From Act III Scene I:

Hath not a health plan premium income? Hath not a health plan cash flow, reserves, surplus, expenses, capital, incurred but not reported; supported with the same FTEs, struggling with the same competition, subject to the same underwriting cycle, criticize'd by the same Boards of Directors, praise'd and criticize'd for the same good and bad quarters as any industry is? If you fine us, do we not end up on the front page? If you demand quality of us, do we not commit considerable resources to disease management? If you sic Michael Moore on us, do we not retrench? And if you wrong us, shall not our PAC support your opponent in the next race? If we are like you in the rest, we will resemble you in that. If a politician extract a mandate, what is his humility? Increased rates. If an insurer stick it to its enrollees, what should his sufferance be by the regulators’ example? Why, increased rates again. The cost inflation you impose on me, I will execute, and it shall go hard but I will better the instruction.

By the way, in yesterday's post, the DMCB made a prediction. Check out its prescience here and here.

And since it is feeling so good about itself, the DMCB would like to point out that it's speaking next week in Washington DC at the World Research Group's '3rd Annual Achieving Return on Investment for Wellness.' Check it out - it should be an interesting conference.

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