(This guest post previously appeared at the White House blog)
In recent weeks, you’ve probably heard a lot about WellPoint, the big insurance company that reported earning $2.7 billion in one quarter, and then promptly raised rates on some customers in California by up to 39 per cent. Those aren’t the only big increases WellPoint has attempted to implement. In 2009, the company sought a 24 per cent increase for its customers in Connecticut, and it’s asked to raise rates by 23 per cent in Maine this year.
This pattern appears to be working for WellPoint. Recently, a major Wall Street analysis found that WellPoint would be a “primary beneficiary” if reform fails.
So it shouldn’t surprise anyone that WellPoint officials are doing everything they can to stop reform. WellPoint is a part of the coalition that has financed millions of dollars television ads against reform. And they are continuing to spread misinformation about what will happen when we make comprehensive reform a reality.
The latest attack came from WellPoint’s CFO, who addressed a group of investors and wrongly claimed that reform would increase costs and drive up premiums. Nothing could be further from the truth.
What WellPoint may not want you to know is that reform will shift power from insurance companies and into the hands of consumers. It will lower your premiums, not increase them, according to the nonpartisan congressional budget office. The CBO has examined reform and determined that customers who buy their health insurance on the individual market would pay 14 to 20 per cent less for the same levels of coverage that they received before. If you get insurance through your job, CBO found that your premiums would likely decrease. In fact, the Business Roundtable recently issued a study that found that reform could reduce costs by as much as $3,000 per employee.
Reform will also create a new marketplace where Americans can purchase affordable, quality health benefits. And Americans buying in the new marketplaces will be eligible for tax credits that can reduce their premiums by up to 60 per cent.
The criticism from WellPoint also ignores the many provisions in reform that will bring down the cost of health care. The health policy experts and economists who have looked at this bill have said we are doing everything possible to reduce health care costs. Some of the steps we’re taking include:
- Pilot programs for bundling payments and paying for episodes of care rather than each individual service.
- Creating accountable care organisations where providers co-ordinate your care;
- Streamlining administrative costs by reducing paperwork burden and standardising forms.
- Bringing more people into the insurance pool and reducing the “hidden tax” that insured individuals pay to cover the cost of caring for the uninsured.
These are just a few of the provisions in reform that will bring premiums down for consumers. And we know what will happen if these provisions and health reform are not enacted. Premiums will rise, companies like WellPoint will thrive and families will suffer. Health insurance reform will lower your costs and give you more control over your health care: that is why the insurance companies are spending millions of dollars trying to stop it.
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