Insurers Concerned About Baucus Bill’s “Workability, Costs”

Insurers were quick to assail yesterday’s Senate Finance Committee passage of the America's Healthy Future Act (by a margin of 14-9) for its potential to cost the health care industry, insurers and consumers.

Though Senate Finance Committee Chairman Max Baucus (D.-Mont.) maintained the bill was crafted to have bipartisan appeal, the only Republican to vote in favor of it was Sen. Olympia Snowe (R-Maine). "My vote today is my vote today,” Snow said. “It doesn't forecast what my vote will be tomorrow."

Upon passage of the bill, American Health Insurance Plans’ President and CEO Karen Ignagni issued a statement saying that while the industry agreed with the objective of the current proposal, it is concerned about its workability and cost.

“The bill imposes hundreds of billions of dollars in new health care taxes and provides an incentive for people to wait until they are sick to purchase coverage,” she said. “A recent analysis by PricewaterhouseCoopers found that these provisions will cause health care costs to increase far faster and higher than they would under the current system. We believe these issues can and should be addressed.”

The Price WaterhouseCoopers (PWC) report was the focus of much attention in the greater press earlier this week. Sparks flew when AHIP released the commissioned report on the eve of the vote that maintained costs would skyrocket for insurers over the course of several years. Yet opponents of the study pointed to certain flaws, calling it “incomplete.”

As the report came under fire, PricewaterhouseCoopers distanced itself somewhat from it, notes the Washington Post. The firm told the Post Monday that AHIP had instructed it to focus on only some features of the bill, while not taking into account other major features such as the effect of subsidies for those buying insurance.

"America's Health Insurance Plans engaged PricewaterhouseCoopers to prepare a report that focused on four components of the Senate Finance Committee proposal," PWC said in a statement. "As the report itself acknowledges, other provisions that are part of health reform proposals were not included in the PwC analysis."

Ignagni openly chastised the association’s detractors, stating that there was a "major effort to discredit and silence" the industry and its allies. "That's just wrong in a democracy," she said.

She also further backed the PWC report, stating that other analyses will reach similar conclusions.
Meanwhile, the bill still needs to be reconciled with a more expansive bill that passed Senate Health, Education, Labor and Pensions (HELP) Committee. The HELP bill contains a public option, while the Baucus Bill does not. Several backers of the Baucus bill, such as Snowe and Sen. Blanche Lincoln (D. –Ark.) indicated that their future support of the legislation was conditional upon it remaining close to the version that left the committee.

If a completed Senate bill passes the Senate, it would also have to be melded with a version of the bill emerging from the House.

When asked about the vote, President Obama was laudatory, but acknowledged the bill has long way to go before becoming law.

“I think they've done excellent work,” Obama said yesterday. “And I think not only Chairman Baucus and others, but in particular Senator Snowe has been extraordinarily diligent in working together so that we can reduce cost of health care, make sure that people who don't have it are covered, make sure that people who do have insurance have more security and stability, and that over the long run we're saving families, businesses, and our government money.”

Ignagni, meanwhile, maintains that AHIP will support a “health plan that will continue to work toward comprehensive, bipartisan health care reform that covers all Americans, improves quality, and makes coverage more affordable.”