Security Issues In Wake Of Attack Back-Burner Insurance Issues
No words available to this writer can adequately describe the scale of events that struck the United States last Tuesday.
The seemingly parochial issues affecting the insurance industry now pending on Capitol Hill pale in comparision to the security issues that now confront Congress.
Industry representatives declined to speculate on when Congress would return to some of the industry-related issues that remain unresolved, such as revenue matters, a patients bill of rights and insurance regulation.
However, they agree, these issues are now on the back burner.
“The focus of Congress, the Administration and the American people will be with issues directly related to the tragedy,” says David Farmer, senior vice president of federal affairs with the Alliance of American Insurers, Downers Grove, Ill.
“I dont think any public policy issues other than those dealing with security will be considered by Congress for the next few weeks,” he says.
Maria Berthoud, vice president of federal affairs for the Independent Insurance Agents of America, Alexandria, Va., agrees.
“The regular agenda has been dramatically altered by these acts of terrorism,” she says. “I cant imagine any legislation other than that involving security to be considered in the coming weeks.”
Another commentator, who asked not to be identified, adds that eventually, Congress will have to return to business as usual.
But in the meantime, he says, Congress will want to make a public show of unity and put off consideration of controversial issues, such as patients bill of rights and budget and tax concerns.
The life insurance industry is wary that life insurance products could come under attack in the search for revenues with a shrinking budget surplus, he notes.
Non-essential issues, he says, such as insurance regulation, which was widely expected to be the subject of further hearings, likely will not be considered for the forseeable future.
In the aftermath of the tragedy, some insurance-related events were postponed indefinitely.
For example, Families USA, the Washington-based health care interest group, cancelled a press briefing called to oppose proposals to provide an individual tax credit for the purchase of health insurance.
A tax credit, which is endorsed by President Bush as a means to reduce the number of uninsured Americans, is insufficient to expand health insurance coverage, Families USA, says.
Similarly, the American Council of Life Insurers, Washington, postponed a press briefing on long-term care insurance and ways to increase coverage.
ACLI supports proposals to provide individuals with an above-the-line tax deduction for the purchase of long-term care insurance.
“Above-the-line” means that the deduction would be available to all taxpayers, whether or not they itemize.
In activities prior to the tragedy, health insurance companies and agents blasted legislation they say would increase the cost of health care in light of a report from the Kaiser Family Foundation, Menlo Park, Calif., estimating that health care costs could increase some 11% next year.
Karen Ignagni, president of the American Association of Health Plans, says Americans are feeling less confident about their economic well-being and are citing rising health care costs as their number one concern regarding the health system.
“Congress faces an important responsibility to reject policies that would make this problem worse,” Ignagni says.
She says the Senate patients bill of rights legislation, S. 1052, takes an “alarmingly careless” approach by allowing new causes of action against health plans and employers for unlimited damages.
“That remedy is as inappropriate a treatment for the problems facing our health care system as gasoline for a forest fire,” Ignagni says. “It will send health care costs even higher and price more Americans out of the health care system.”
Janet Trautwein, director of federal policy analysis for the National Association of Health Underwriters, Arlington, Va., adds that instead of holding health plans and employers liable for millions of dollars, Congress should focus on independent external review as the primary means of determining health plan liability.
“It provides for accountability without dragging health care decisions into the court room, which causes the cost of health care to go up and benefits only trial lawyers,” Trautwein says.
Many business owners may stop offering insurance coverage if exposed to million-dollar liability suits, she adds.
The more reasonable external review process, she says, will keep the employer-based health insurance system intact.
An employers group, the National Association of Manufacturers, Washington, adds that the Kaiser Family Foundation study should serve as a “yellow caution flag” to House-Senate Conferees on patients protection.
“With the economy continuing to struggle and job losses mounting, this is the worst possible time to pass patients rights and mandate legislation that will increase the health care cost burden for workers,” says Neil Trautwein, NAMs health care lobbyist.
Reproduced from National Underwriter Life & Health/Financial Services Edition, September 17, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.