Health plans will guarantee coverage, if insurance is mandated

Washington -- A national health insurers' association released a health reform proposal that would guarantee coverage for people with preexisting conditions in exchange for the government requiring everyone to have health insurance.

America's Health Insurance Plans unveiled the proposal Dec. 3 after three years of developing its national health system reform policies and soliciting public input on the issue. "Today our board is making a strong statement that now is the time for health care reform," said AHIP President and CEO Karen Ignagni. The plan's four main principles are controlling costs, adding value, assisting consumers and businesses, and covering everyone.

The proposal also calls on Congress to set a goal of reducing national health expenditures by 30% over five years -- a cumulative total of $500 billion. A public-private advisory group could devise a plan to achieve this goal. The process could start by examining variations in care around the U.S., by paying based on quality rather than volume, and by improving administrative efficiency, according to AHIP.

AHIP committed itself to help reduce costs and administrative hassles by developing a uniform online portal allowing physicians and hospitals to communicate with health plans and to access up-to-date information on benefits and eligibility.

The plan also calls for increasing eligibility for the State Children's Health Insurance Program to 300% of the federal poverty level, and for Medicaid, to 100% of poverty. It also would offer sliding-scale tax credits for buying health insurance to people with incomes at less than 400% of poverty, and it would give the same tax benefits to those buying individual health insurance as those in group coverage.

However, Rose Ann DeMoro, executive director of the 85,000-member California Nurses Assn., said the plan's call for reducing costs does not address health plans' profits or place "any limits on insurance industry price gouging, profiteering or lavish executive pay packages."

"In sum, it fully privatizes profit while socializing the health care risk," DeMoro said.

President-elect Obama has embraced a mandate for covering children, but he has said he only would support a mandate for adults once health insurance is affordable for everyone.

The AHIP proposal is available online (link).