The McCain Health Plan Explained: Freedom For Insurance Companies
The McCain Health Plan Explained: Freedom For Insurance Companies
John McCain summed up his own approach to health care in a Des Moines speech this way: “I offer a genuinely conservative vision for health care reform, which preserves the most essential value of American lives – freedom.”
That’s health care rhetoric that you could serve up with a slice of apple pie during a baseball game. But freedom for whom? When McCain talks about ‘freedom,’ he isn’t talking about regular families. He means health plans should be free of regulation. (Read Jeanne Lambrew’s piece on what “Conservative Health Reform” means.)
One of John McCain’s central ideas is to free insurance companies from state regulations that protect individual consumers, having said, “You should be able to buy your insurance from any willing provider – the state bureaucracies are no better than national ones.” The not-so-subtle implication is that the marketplace is all that is needed to keep health insurers in check.
McCain’s marketplace, though, would reduce costs for insurers at the expense of people. Two years ago, California’s then-Insurance Commissioner John Garamendi issued a scathing report on the conservative’s reform approach, explaining that insurers could avoid the health plan rules in some states mandating that specific benefits (such as cancer testing and preventive care for children) be offered and that specific providers (such as psychologists) be covered. State rules that help small businesses purchase insurance coverage would also be in jeopardy. Real insurance reform – like prohibiting insurance companies from refusing to cover people with health problems – wouldn’t stand a chance.
McCain’s plan comes at a time when the insurance industry shows that it needs more, not less, regulation. Just look at what insurers are doing with their freedom today.
– In California, the state is considering fines as high as $1.3 billion against PacifiCare for wrongly denying claims.
– In New York, Attorney General Andrew Cuomo is moving against UnitedHealth and others for charging patients too much to see out-of-network doctors.
– California-based Health Net paid bonuses based in part on how successful employees were at canceling (in insurance-speak, it’s called a “rescission”) health policies it had sold to customers that incurred high medical bills.
There needs to be freedom in health care. But John McCain has it all wrong. He would create a race to the bottom as insurers aggressively market health plans from states with the weakest regulations. We should start with the freedom from fear that insurance companies will simply abandon the sick when their care gets too expensive.
7 Responses to “The McCain Health Plan Explained: Freedom For Insurance Companies”
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Isn’t it true, though, that there really isn’t a health care market? I mean, costs for operations vary all across the country, and if we could create more of a national marketplace for insurance, perhaps that competitiveness would drive down costs. Also, doesn’t the tax structure discourage individual – and thereby portable – insurance and favor employer-based insurance? Just wondering.
March 18th, 2008 at 6:06 amthirdparty Says:
March 18th, 2008 at 6:06 am
Isn’t it true, though, that there really isn’t a health care market? I mean, costs for operations vary all across the country, and if we could create more of a national marketplace for insurance, perhaps that competitiveness would drive down costs.
Costs for operations vary around the world. There’s a reason why Americans are increasingly traveling to India and Thailand for operations that cost a fraction of what they’d cost in the United States – including airfare.
March 18th, 2008 at 7:57 amUnless Edward Heath has returned from the dead to partner with McCain, I believe you need to correct the spelling in your headline.
March 18th, 2008 at 8:23 amWe need a not-for-profit, single-payer health insurance on the French model. We need to front load health maintenance by rewarding primary care/family practice practioners better and restructuring compensation toward them away from the specialists to a reasonable degree. Also, we need to get medication expenditures under control through economies of scale.
March 18th, 2008 at 9:51 amThere is a health care market in the United States. However, it is a market that provides all of the bargaining power to the insurance companies. We see this several ways:
1. The insurance companies are freed from responsibility for making decisions that are essentially medical in nature. However, ERISA created a significant barrier to employee action against insurance and managed care companies regulating the provision of services to employees.
2. Insurance companies driven by profit motive seek ways to limit payouts which have led to the scandals in providing coverage.
3. Individuals have no bargaining power with the insurance companies over the cost and composition of policies when bought on an individual basis.
4. The sheer multiplicity of insurance options and the difficulty in determining future medical needs on the part of the individual purchaser makes it difficult to really assess the desirability of policies.
5. Cherry picking has become the rule of the day with the primary purpose of the insurers to pick out those with the least likely need for medical services. As these individuals age or develop chronic disease, the insurance companies quickly drop them as customers or steer them into policies that are either too expensive to maintain or provide insufficient coverage.
6. Employer provided insurance is going the same way as employees take on greater deductibles and co-pays as well as steered into HSA plans.
March 18th, 2008 at 1:55 pmTo thirdparty:
The healthcare market does vary across the country. However, we physicians do not determine our reimbursement regardless of what we bill the insurance companies. They pay us a set rate for a particular operation, irrespective of our charges. Interestingly, the bar is set by Medicare. Every insurance company reimburses us at a percentage of Medicare. That percentage can be negotiated, but usually only by a large medical group. The guys in small groups like myself typically are left with the base contract of 90% of Medicare, “take it or leave it.”
March 23rd, 2008 at 6:24 pmI find the criticisms of McCain’s plan to be spot-on. This is just more money thrown into big business to increase profits, executive salaries, and will serve to diminish access to health care instead of improve it.
March 23rd, 2008 at 6:25 pm