Health Insurers Return To The Table -- Again

Los Angeles Times
May 17, 2009

It sure was nice seeing representatives of the insurance industry sitting down with the president and declaring that they know the healthcare system needs to be overhauled and that they definitely want to be part of the solution.

Just one small thing: Does anybody trust them?

I spoke last week with a variety of healthcare experts, and not one could give me a "yes" to that question.

"Some of these people in the insurance industry are friends of mine," said Alain Enthoven, a professor emeritus at the Stanford Graduate School of Business who served as a consultant to the Carter administration on healthcare issues. "I like them personally. But I don't trust them."

He pointed out that when he and others crafted a plan for universal coverage in the 1970s, the insurance industry proudly announced that it was ready to compromise to serve the nation's best interests.

"Nothing came of it," Enthoven said. "The whole thing was just a joke."

Karen Pollitz, a research professor at Georgetown University's Health Policy Institute and a former health official in the Clinton administration, said insurers were similarly gung-ho when universal coverage once again became a going concern in the 1990s.

"They said they wanted to be at the table and wanted to deal," she recalled. "Then they all left. They saw that they could kill it."

So here we are again. President Obama said last week that "the stars are aligned" to pass healthcare reform legislation this year.

He also hailed it as "a historic day, a watershed event" after representatives of the insurance, pharmaceutical and medical industries joined him at the White House to underline their commitment to making universal coverage a reality.

You almost expected everyone to break into a chorus of "We Are the World."

In fact, it's hard to see how things are different this time around. Once again we have a Democratic administration committed to upending our woefully dysfunctional healthcare system.

And once again the healthcare industry is presenting itself as a willing and enthusiastic agent of change.

Why should anyone believe that the outcome will be any different now from what happened 15 years ago?

"Everything's different this time," answered Robert Zirkelbach, a spokesman for America's Health Insurance Plans, a leading industry group. "Everybody learned valuable lessons from 15 years ago."

So now we're looking at kinder, gentler insurance companies?

"Unlike last time around, our industry has made a commitment to come to the table with workable solutions," Zirkelbach said. "We're taking a dramatically different approach to reform than we did 15 years ago. Back then, we opposed reform. Now we support it."

I feel better already.

But when I asked Zirkelbach about the $2 trillion in cost reductions that the healthcare industry says it can come up with over 10 years, he said the details were still being hammered out.

As for Obama's proposal for a public plan to compete with private ones and keep costs down, Zirkelbach said, "We have significant concerns about that, absolutely."

And he wasn't very committed to the insurers' recent claim that they'll stop denying coverage to sick people or those with preexisting conditions. Zirkelbach said this would be contingent on lawmakers approving a national mandate for health insurance -- in other words, a requirement that everyone has to buy the industry's products.

Are those changes still possible without a mandate?

"Probably not," Zirkelbach replied.

Maybe insurers and lawmakers need to be reminded of what's really at stake here. This isn't just about what's politically feasible or financially palatable.

It's about people like Atascadero residents Monica and John Rosecrans, both 57. They lost their health insurance in 2007 when John was fired from his job renting recreational vehicles to vacationers.

First the couple turned to COBRA, the government program that provides coverage for a limited time to people who lose employer-based health benefits. It cost them about $800 a month. Then the Rosecranses shopped around for policies in the individual insurance market. Monica now pays $600 a month for coverage with Anthem Blue Cross. John pays $700 a month.

"It's wiped out all our savings," Monica told me. "But we're at an age where if anything happened to us, we'd be paying far more.

"We can't afford health insurance," she said. "But we can't afford not to have it."

The same goes for the rest of us. That's what Obama and members of Congress need to remember as healthcare executives start haggling over terms -- or if, yet again, they get up and leave the table.

This isn't about their needs. It's about ours.

Do you trust insurers to help reform the healthcare system?

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