Insurers: Any Government-Run Health Plan 'Devastating'
The nation's largest health insurer trade group issued their
strongest stand to date Tuesday against a public health insurance
option, saying that any government plan would force "devastating
consequences" on the current insurance arrangements.
America's Health Insurance Plans, which represents a broad range
of U.S. health insurers, made the remarks in a June 19 letter to
Sen. Edward Kennedy, D-Mass. Kennedy chairs the Senate Health,
Education, Labor and Pensions Committee, which is considering
health-care overhaul legislation in meetings this week.
The letter, also signed by Blue Cross and Blue Shield
Association president Scott P. Serota, states that a public health
insurance option "would dismantle employer-based coverage,
significantly increase costs for those who remain in private
coverage, and add additional liabilities to the federal
Congressional Democrats have sought to soften the impact of a
public plan by including assurances in their proposals that it
would compete on a "level playing field" with private plans. For
example, House Democrats issued a proposal last week that would not
allow a new public plan to inherit the network of doctors and
hospitals that Medicare already has.
But the letter states that a public plan would have adverse
effects "no matter how it is initially structured."
Members of AHIP include large insurers such as Aetna Inc. (AET),
Humana Inc. (HUM), Cigna Corp. (CI) and UnitedHealth Group
The Senate Health panel has yet to unveil details of a public
health insurance option expected in its version of the legislation.
Sen. Christopher Dodd, D-Conn., who is leading efforts on the
legislation in lieu of the ailing Kennedy, said Tuesday that
concerns about the cost of the bill have kept committee Democrats
from finalizing the public plan provision and a proposed
requirement that employers provide health coverage or face a
Republicans on the committee strongly oppose both
The Senate Finance Committee is drafting its own version of
health-care legislation, but it is still attempting to negotiate
the measure on a bipartisan basis. Some Democrats on that panel,
such as Sen. Kent Conrad, D-N.D., have warned that health-care
legislation containing a public plan could not meet a 60-vote
threshold needed to pass most legislation in the U.S. Senate.
Conrad has sought support for a non-governmental health
co-operative that would see start-up funding from the federal
government but that would eventually be run by its members. But
Sen. Charles Schumer, D-N.Y., also a member of the Senate Finance
panel, has stated that the co-op idea may not see support from some
-By Patrick Yoest, Dow Jones Newswires; 202-862-3554;