Pundits laud passage of health insurance reform bill by House, by Dr. Norm Oliver, Director of UVa Center on Health Disparities, in Oliver’s Twist

Nov.8, 2009
Oliver’s Twist
A Blog by Dr. Norm Oliver, Director of UVa Center on Health Disparities

http://healthdisparities.virginia.edu/2009/11/08/pundits-laud-passage-of-health-insurance-reform-bill-by-house/



This morning, the pundits are hailing last night’s passage of the “Affordable Health Care for America Act” (see http://tinyurl.com/qyajn9 for summary) by the U.S. House of Representatives. However, the House health care bill marks no great advance toward providing quality health care services to working people in this country.

The legislation, if enacted, mandates individuals to purchase insurance. This provision will create millions of new customers for the insurance industry and generate billions of dollars in profits. (http://tinyurl.com/lyrj3q) Individuals and small employers will purchase insurance through a “health insurance exchange,” in which some insurance companies will participate and the government will provide a public insurance option. Individuals may qualify for a government subsidy to help pay their insurance premiums, and Medicaid will be expanded to cover more people. Some small employers will be allowed to opt out of providing health insurance plans to their employees, and others will be eligible for a government subsidy.

The mandate requiring individuals to purchase health insurance will be a hardship for many. The government subsidies will be adjusted so that individuals will pay anywhere from 1.5% to 12% of their income as health insurance premiums. The penalty for not purchasing health insurance is that you must then pay 2.5% of your income into the plan. Those under age 65 with annual incomes below $18,700 for a couple or $9,350 for an individual will be exempted from the mandate, which means (in today’s economy) millions will be uncovered by this insurance plan. As the lowest-paid workers, African Americans and Latinos will be the hardest hit by these provisions. Undocumented workers, who disproportionately lack health insurance, would be denied access to the so-called public option in this plan, and they would be ineligible for subsidies to pay for private health insurance.

The supposed benefits of the legislation are meager at best. Millions of people will remain uninsured. The touted reform to eliminate pre-existing health conditions as an excuse to deny health insurance coverage provides insurance for these people; however, it requires those with chronic health problems to pay higher premiums. The bill calls for developing a “high-risk” pool of those with pre-existing medical conditions, whose premiums will be set at 125% of the prevailing rate. The so-called public option calls for a government insurance plan that would compete with all private insurance companies in the exchange. The public plan will pay providers at least the Medicare rates; however, providers may opt out of the plan.

So, this health insurance reform bill will leave millions still uninsured, exact huge cuts on individual workers’ incomes through mandatory insurance premiums, generate huge profits for the insurance industry through enrollment of millions of new customers and higher premiums for “high-risk” clients, deny coverage to undocumented workers, and continue to deny federal money to women seeking to exercise their legal right to an abortion.

What’s to celebrate? As I see it, it’s no exaggeration to say that this bill condemns tens of thousands of people — disproportionately Black and Latino — to death. Rather than a sweeping reform of the U.S. health care system, it’s a reform of health insurance that funnels billions of dollars into that industry while leaving millions of working people with inadequate or no insurance.
Sunday, November 8th, 2009