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Politics : A US National Health Care System? -- Ignore unavailable to you. Want to Upgrade?

To: i-node who wrote (10624)	10/21/2009 10:21:07 AM
From: Peter Dierks	2 Recommendations Respond to of 42652

Competition and Health Insurance Contrary to Democratic rhetoric, repealing the insurance industry's antitrust exemption won't reduce prices or profits. OCTOBER 21, 2009, 9:47 A.M. ET. By SCOTT HARRINGTON During his weekly radio address last Saturday, President Obama attacked health insurers for allegedly making excessive profits and paying excessive bonuses, for spreading "bogus" misinformation about the impact of Democrats' reform agenda on the cost of health insurance, and for "figuring out how to avoid covering people." He opined that health insurers are "earning these profits and bonuses while enjoying a privileged exemption from our antitrust laws, a matter that Congress is rightfully reviewing." Mr. Obama's comments followed hearings by the Senate Judiciary Committee last week. In an unusual move, Majority Leader Harry Reid testified as a witness, alleging that "exempting health insurance companies [from antitrust] has had a negative effect on the American people" and that "there is no reason why insurance companies should be allowed to form monopolies and dictate health choices." Such populist rhetoric might exert additional pressure on insurers to fall (back) into line behind the Democratic reform agenda. But there is no evidence that their antitrust exemption has contributed to higher health insurance costs, premiums or profits, or, as implied by Sen. Reid, of "health insurance monopolies . . . making health-care decisions for patients." The legislative basis for the insurance antitrust exemption is the 1945 McCarran-Ferguson Act, which also codified state insurance regulation as national policy. This statute exempts the "business of insurance" from federal antitrust law provided that the activities are (1) regulated by state law and (2) do not involve boycott, coercion or intimidation. Its passage followed a 1944 Supreme Court ruling that insurance was interstate commerce and therefore subject to federal antitrust law—a ruling that cast doubt on states' exclusive regulatory role, and the legality of then typical agreements among property and casualty insurers to use rates developed jointly by state or regional insurance rating organizations. Most states responded to McCarran-Ferguson by enacting or modifying laws giving regulators authority over property/casualty insurance rates, including those developed by rating organizations. The next several decades saw a steady erosion of the role of collective pricing systems in conjunction with increased price competition, less price regulation, and a significant narrowing of the antitrust exemption's scope by the courts. The traditional debate about the antitrust exemption involved property/casualty insurance and medical malpractice liability coverage. Subject to state regulation or prohibition, property/casualty rating organizations collect and analyze loss costs and disseminate projections of future losses. And insurers, subject to state law, can incorporate these forecasts in their ratemaking. In principle, this system helps produce more accurate rates, thus improving financial stability. More important, it reduces entry barriers for small insurers or insurers entering new markets. Small property/casualty insurers are particularly strong supporters of the antitrust exemption, which allows the sharing of loss projections. None of this is germane to health insurance, where insurers do not jointly develop forecasts of future medical costs for use in pricing. The antitrust exemption also does not prevent review and challenge of mergers of health insurers by the Department of Justice, which, for example, challenged the 2005 merger of UnitedHealth Group and PacifiCare, and obtained a consent decree requiring the divestiture of certain portions of PacifiCare's commercial health business. Mergers and acquisitions of health insurers also are generally subject to approval by state regulators. Earlier this year, Pennsylvania Insurance Commissioner Joel Ario derailed a proposed merger between the state's two largest health insurers, Highmark and Independence Blue Cross. Repealing the antitrust exemption for health insurers would not significantly increase competition, and it would not make health-insurance coverage either less expensive or more available. There is no evidence that the exemption has increased health insurers' prices or profits or contributed to higher market concentration. Repealing the antitrust exemption would also not lower the cost of malpractice insurance, or prevent future malpractice insurance crises, such as those that occurred in the mid-1970s, mid-1980s, and earlier this decade. It would instead tend to reduce rate accuracy and undermine competition in already fragile malpractice markets. In other words, the insurance industry's antitrust exemption is inconsequential to the health-care reform debate. It just distracts attention from important issues and further demonizes private health insurance. Rhetoric about monopoly notwithstanding, Congress's reform proposals are not designed to increase competition in private health insurance. The House bill proposes a government-run insurer. The Senate Finance Committee proposes creation of quasi-public cooperatives. Both bills (and the Senate HELP bill) include restrictions on health insurance underwriting, pricing, profitability and policy design that would essentially turn private health insurers into regulated public utilities. If the goal were to promote robust concentration in private health insurance, Congress would focus on reducing impediments to competition. It could do so by allowing consumers to buy insurance across state lines at terms that do not require them to subsidize other buyers or to buy coverage for state-mandated benefits they are unwilling to pay for. Congress could also eliminate tax and regulatory rules that favor employment-based coverage over individual coverage. In short, the rationale for repealing the insurance antitrust exemption is—to borrow a word used by Mr. Obama in his radio address—bogus. Mr. Harrington is professor of health-care management and insurance and risk management at the University of Pennsylvania's Wharton School and an adjunct scholar at the American Enterprise Institute. online.wsj.com

To: i-node who wrote (10624)	10/21/2009 11:00:09 AM
From: Lane3	Read Replies (2) \| Respond to of 42652

There is no requirement that the "perversions" be new to be classified as radical. Not sure where that came from. To be radical something needs to be different, very strange, very, very "out there" in some way or other. I cannot imagine any other standard. If past administrations did the same thing, albeit not routinely, I don't see how all of a sudden they get to be radical. Lane, you're reaching here. I think you're the one who's reaching. You're overgeneralizing and exaggerating. You don't like the guy or his approach, ergo he must be all variety of bad things like a liar and a radical. Probably a bastard, too. <g> I don't think you've made a case based on the meaning of the words. If you disapprove of him so much, then pick a more precise and apt notion of what it is about him you disapprove than "radical." I disapprove of him because he is too centrist and command-and-controlling for IMO the good of the country, fiscally irresponsible, and redistributionist, to boot. But that doesn't make me believe that he tortures small animals or fails to wash his hands when he uses the toilet. Or that he isn't charming and smart. As to "nationalization", it is a matter of degree. Exactly what I have been arguing. Nationalization is more radical than a distorted bankruptcy. If there are more radical options out there, than a distorted bankruptcy cannot, by definition, be radical because it is, indeed, a matter of degree. Fiddling with the bankruptcy process is an increment, not a leap. Nationalization is a leap. to do so is contrary to long-established Senate rules. That makes it radical imo. That makes it disreputable. That's different from radical. nothing this sweeping I agree with you that there's more at stake here, which makes it more egregiously disreputable. But the tactic isn't novel. In any event, that confuses radicalism, the leftist ideology, with extreme tactics, again not the same thing. No president of the US has conducted an "apology tour" the way Obama has and I'm not aware of any president who has so frequently and harshly bashed the United States. I haven't commented on that because I don't know enough about it to speak intelligently about it. I have heard the complaint but I haven't seen or heard what he said that might be construed as radical. There is no precedent, AFAIK, for what they're doing here. Every administration tries to manipulate the press corps and most are at war with some part of it in one way or another. Whether you go after the NYT or Fox is a function of your party. Whether you refuse to recognize certain reporters in press conferences, shuffle the press corps to less attractive digs, refuse to address the National Press Club, or try to foment internal conflict within the corps as Obama is doing, it's just a matter of tactics. there is a REASON such a large number of people are concerned about the direction the country has taken. Of course there is. But that doesn't make him a radical. There have been lots of reasons for concern at various times. Concern doesn't imply "radical." Consider the large number of people concerned about the direction of the country when Bush invaded Iraq. Does that make Bush a radical? One could argue that he is based on your criteria. Perhaps even by mine. After all, invading a foreign country that isn't a threat to us, particularly one bigger than Granada, while done in the past, is pretty far out there. (As to James Watt, I agree -- he was out there and had no place in the cabinet). Nice that we can agree on something.