Below The Beltway

Timothy Carney details the reasons why opponents of ObamaCare should still be wary of the insurance industry:

Dear conservatives: Health insurance companies are not your friends. Keep opposing a new government-run insurer, a single-payer plan, and new regulations on the HMOs. But grant that Speaker of the House Nancy Pelosi is correct on this: Insurance companies are villains.

Insurance companies lobby for big-government regulations, subsidies, mandates, and tax-code distortions that funnel them money, keep out competition, and stultify innovation. These policies preserve the employer-based health-care system that mocks the idea of free-market competition. Then they cry “unfair competition” when government threatens to encroach on their government-protected monopolies.

But they’re not just lobbying against a government option. Today, health insurers are lobbying to force you and me to buy their product or face a tax hike (the individual mandate).

They are lobbying to force entrepreneurs to buy insurance for employees (the employer mandate). They are lobbying for more subsidies paid for by us taxpayers. In short, they are lobbying against regular people and against the free market.

The insurers’ lobbyists stood on stage with Rahm Emanuel and Nancy Pelosi in 2007 calling for the expansion of the State Children’s Health Insurance Plan to cover adults and middle-class children–an unreasonable expansion Democrats used as a political cudgel against Republicans.

They also benefit from an absurd tax break–the exclusion on employer-provided health benefits that drags down wages, shifts money into their industry, increases the deficit, and dries up the individual insurance market where actual competition could take place.

Most shocking to the conscience, however, might be the special protection big government provides for insurers covering patients through employer-sponsored plans: even if an insurance company’s negligent denial of coverage causes harm or death, federal law protects insurers from legal liability.

Also, Rep. John Shadegg, a conservative Republican from Arizona, has proposed a bill to allow interstate purchase of health insurance. Blue Cross has fiercely opposed this idea that could introduce more competition. Currently, Blue Cross companies typically have only a handful of competitors in each state.

This is an industry that thrives on government protection. But still many conservatives and Republicans stand up for it and speak as if we have an obligation to protect it. We don’t.

Shadegg agrees: “I don’t think that they are our friends, and that we ought to be protecting them.”

In other words, the insurance industry is far more like James Taggart than Hank Rearden