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Thanks To Obamacare, Iowa Insurer To Stop Selling Health Insurance | Missouri Political News Service

Thanks To Obamacare, Iowa Insurer To Stop Selling Health Insurance

October 1st, 2010 by sclemons · No Comments

On Wednesday, President Obama was in Iowa to again attempt to sell his policies, particularly his unpopular health care law. In a backyard discussion, a woman expressed her concerns to the President about his health care bill. Obama assured her, “[T]here’s nothing in the bill that says you have to change the health insurance that you’ve got right now.” He went on to say, “[I]f you’ve got health care through your employer, that’s not going to change, except to make it a little bit safer and more secure.”

But The New York Times reports today, “The Principal Financial Group announced on Thursday that it planned to stop selling health insurance, another sign of upheaval emerging among insurers as the new federal health law starts to take effect. The company, based in Iowa, provides coverage to about 840,000 people who receive their insurance through an employer.” So in the very same state the President assured an audience that if they get their health insurance through their employer, “that’s not going to change,” two days later, the NYT is reporting that 840,000 people in that state will no longer be able to get the exact same plan they had.

The NYT adds, “Principal’s decision closely tracks moves by other insurers that have indicated in recent weeks that they plan to drop out of certain segments of the market, like the business of selling child-only policies. State regulators say some insurance companies are already threatening to leave particular markets because of the new law.”

Indeed, the NYT notes that just yesterday, “McDonald’s recently asked federal officials for an exemption to rules that would ban the kind of health plans many of its restaurant workers have, because the existing policies sharply limit coverage.” The Wall Street Journal broke the story, pointing out, “The move is one of the clearest indications that new rules may disrupt workers’ health plans as the law ripples through the real world.” According to the WSJ, McDonald’s dropping its insurance plans could affect “nearly 30,000 hourly restaurant workers.”

 Just last week, The Washington Post reported, “Some of the country’s most prominent health insurance companies have decided to stop offering new child-only plans, rather than comply with rules in the new health-care law that will require such plans to start accepting children with preexisting medical conditions after Sept. 23.” As The Post noted, “Three insurers – WellPoint, Cigna and CoventryOne – all cited uncertainty in the health insurance market for their decisions. That incertitude and the resulting decision of other insurers to drop their child-only plans, according to WellPoint spokeswoman Kristin Binns, ‘has created an unlevel competitive environment.’”

Today’s New York Times story adds, “At the Principal Financial Group, the company’s decision reflected its assessment of its ability to compete in the environment created by the new law. . . . More insurers are likely to follow Principal’s lead, especially as they try to meet the new rules that require plans to spend at least 80 cents of every dollar they collect in premiums on the welfare of their customers. . . . “It’s just going to drive the little guys out,” said Robert Laszewski, a health policy consultant in Alexandria, Va. . . . Mr. Laszewski is worried that the ensuing concentration is likely to lead to higher prices because large players will no longer face the competition from the smaller plans.”

Of course, this isn’t what Democrats promised when they were trying to sell their health care bill. Senate Majority Leader Harry Reid (D-NV) said last year, “In fact, one of our core principles is that if you like the health care you have, you can keep it.” Sen. Max Baucus (D-MT), the Finance Committee chairman who had a hand in writing the bill, said, “Folks who are satisfied with their current health insurance coverage could keep it. People would not be required to change health plans.” And another senator heavily involved in crafting the health care law, Sen. Chris Dodd (D-CT), said, “I say at the outset, if you like what you have, you get to keep it, choose your doctor, hospital, choose the insurance program you have.”

But Americans were rightly skeptical of these unrealistic promises, and they were very clear that this wasn’t the kind of health care reform they were looking for. Yet Democrats arrogantly rushed the bill to passage. The bill was so poorly thought out that companies are already asking for waivers from some of the innumerable mandates in the bill so that tens of thousands of their employees won’t lose their health coverage. Today’s news is just one more broken promise capping six months of stories showing the American people and Republicans in Congress were right all along in opposing Democrats’ health care law.


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