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The Truth About Health Care Reform

by @ 10:17 am on July 16, 2009. Filed under Economics, Health Care Reform, Politics

Hidden within the language of the House Democrats’ Health Care Bill is a provision that would effectively destroy the market for private health insurance:

It didn’t take long to run into an “uh-oh” moment when reading the House’s “health care for all Americans” bill. Right there on Page 16 is a provision making individual private medical insurance illegal.

When we first saw the paragraph Tuesday, just after the 1,018-page document was released, we thought we surely must be misreading it. So we sought help from the House Ways and Means Committee.

It turns out we were right: The provision would indeed outlaw individual private coverage. Under the Orwellian header of “Protecting The Choice To Keep Current Coverage,” the “Limitation On New Enrollment” section of the bill clearly states:

“Except as provided in this paragraph, the individual health insurance issuer offering such coverage does not enroll any individual in such coverage if the first effective date of coverage is on or after the first day” of the year the legislation becomes law.

So we can all keep our coverage, just as promised — with, of course, exceptions: Those who currently have private individual coverage won’t be able to change it. Nor will those who leave a company to work for themselves be free to buy individual plans from private carriers.

In other words, if this bill passes, you would be able to keep your current health insurance as Obama promises, but you wouldn’t be able to make any changes to it beyond adding or deleting new dependents, and the insurance company wouldn’t be able to increase premiums for specific risk groups without raising everyone’s premiums by the same amount, and they won’t be able to accept any new customers under the existing plan. Insread, they’d have to offer plans that comply with the rules set forth in the Democrats’ bill.

You can read the language for yourself, just go page 16.

Ed Morrissey is spot-on in describing what the impact of this part of the legislation would be:

[It] will have the effect of forcing millions of people into the public plan whether they want it or not. Even worse, if insurers get barred from attracting new customers — which this clause outlaws — then they will eventually see their rolls drained, thanks to the natural flow of the market as employers drop plans and skip the expense of offering medical insurance. It won’t take long at all for insurers to exit the market and leave the field for just the public plan, which will automatically get the customers of each individual insurer as they close up shop.

Does this bill outlaw private insurance? Literally, no, but in practical terms, it makes it an endangered species and creates an American single-payer system by default.

The good news ? It looks like the Blue Dog Democrats are joining Republican efforts to fight the worst parts of Obamacare:

Centrist Democrats are threatening to oppose their party’s healthcare legislation unless House Speaker Nancy Pelosi (D-Calif.) accepts changes that make the bill more to their liking.

Seven Blue Dogs on the House Energy and Commerce Committee have banded together to draft amendments that they’ll co-sponsor in the committee markup, which starts Thursday. Rep. Mike Ross (D-Ark.), the Blue Dogs’ point man on healthcare, says if those changes aren’t accepted, they’ll vote down the bill.

“We cannot support the current bill,” Ross said. “Last time I checked, it took seven Democrats to stop a bill in Energy and Commerce.” …

Blue Dogs think the bill fails to do enough to reduce healthcare costs, jeopardizes jobs with a fee on employers that don’t provide health insurance, and would base a government-run healthcare plan on a Medicare payment system that already penalizes their rural districts.

Here’s hoping that they can stop this monstrosity because, if it passes, it’s game over.

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3 Responses to “The Truth About Health Care Reform”

  1. Arizona News says:

    We all want quality, affordable health care for all. Government run health care is not going to be the solution.

    I think if we turn back to the old style indemnity health insurance we will reduce the HMO bureaucracy and save a lot.

  2. Jessica says:

    Your post is intentionally misleading. Even the Heritage Foundation says the allegations about “page 16″ are bunk.

    “The conservative Heritage Foundation also said the editorial misread the legislation, writing on its Foundry blog, “So IDB is wrong: individual health insurance will not be outlawed.” Heritage believes that the new regulations will be so onerous as to drive private insurance out of business “which is effectively the same thing.” But that is a substantially different argument than what the editorial said.”

    Please print a retraction. see reference article below.

    http://www.politifact.com/truth-o-meter/statements/2009/jul/22/ibdeditorialscom/private-health-insurance-page-16-house-bill/

  3. Joe Rompala says:

    Returning to an indemnity program is probably the worst of all possible choices. We need to manage our care. That indemnity model is one villan in driving medical inflation.

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