Insurers Face Barrage Of Challenges In Overhaul’s RolloutThe New York Times: "The first big wave of new rules under the federal health care law goes into effect on Thursday, leaving many insurers scrambling to get ahead of the changes. Insurers are cutting administrative staff to lower overhead costs, investing in big technology upgrades and training employees to field the expected influx of customer inquiries." And they're looking forward to even more significant changes on the horizon in a few years. A PricewaterhouseCoopers analyst said many plans may "struggle and fail" in the face of the burden. Top insurance lobbyist Karen Ignagni compared the industry's effort to the Manhattan Project as whole businesses reconfigure to comply with the law (Abelson, 9/22).
ABC News: In particular, "[t]he move by some health insurance companies to scrap child-only policies has many questioning whether providers will try to circumvent provisions of the new health care reform law in the future." Big insurers made the move because they would be prohibited from denying coverage to kids with pre-existing conditions, meaning they could buy insurance only when they become ill, and drop it afterwards. Ron Pollack, of Families USA, said, "There's a concern about how insurance companies are going to react to the wide variety of new requirements that they've got. They're just going to try and elude those requirements in different ways." An industry spokesman said firms were making "difficult decisions" out of economic necessity (Kahn, 9/23).
The New York Times, in a separate story: One upcoming provision of great interest to insurers is a requirement that they spend at least 80 percent of premium revenues on medical care. In a meeting with White House officials Wednesday, state insurance regulators asked that those requirements by phased in gradually. "State officials said they feared that some companies would withdraw from the individual insurance market next year because they could not meet the 80 percent requirement." But, some Democrats at least view the provision as a key consumer protection and will resist anything that appears to be a watering-down. Some states are requesting waivers of the provision (Pear, 9/22).
CongressDaily: The state insurance commissioners warned the White House "that insurers in several states may not be able to meet the direct medical spending requirement set for next year in the healthcare overhaul law." Florida commissioner Kevin McCarty said, "Our concern in Florida, as we look at this implementation of the [medical loss ratio], is what the potential disruption to market may be. To be thoughtful and realistic, you have to take into recognition that we can't put this all into place immediately, if our goal is to minimize disruption" (McCarthy, 9/23). This is part of the KHN Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.