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Life Health > Health Insurance > Health Insurance

The Catch: Oct. 27

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Health Affairs – the academic journal for people who get excited about new Patient Protection and Affordable Care Act (PPACA) interim final rules – has published a paper about what might happen if Congress or the Supreme Court eliminates the PPACA individual coverage ownership mandate but leaves the rest of the law intact.

The authors, John Sheils and Randall Haught, work for the Lewin Group, Falls Church, Va., a unit of UnitedHealth Group Inc., Minnetonka, Minn. (NYSE:UNH).

Health insurers have argued that they need for the United States to require most people to have health coverage if the government is going to require health insurers on a guaranteed-issue, mostly community-rated basis.

Otherwise, health insurers and others have said, many consumers will buy health coverage only when they are sick, or expect to be sick, and escalating claims and premium costs will lead to a death spiral.

Critics of the PPACA individual health coverage mandate say the government should have no more right to order individuals to buy health insurance than it should have to order individuals to buy GM cars, or broccoli.

The Lewin Group analysts have estimated that, even if the individual mandate were eliminated, PPACA would still lead to 23 million previously uninsured U.S. residents gaining coverage.

Eliminations of the individual mandate could increase the total number of people who are uninsured in a few years to about 7.8 million, with 2.1 million fewer people having employer coverage and 4.5 million fewer people having individual or family commercial coverage, but coverage ownership might still be high enough that PPACA could work even if the ownership mandate went away, the analysts say.


One quirk of the U.S. health finance market is that working-age people cannot buy insurance designed specifically to protect themselves against the gaps in Medicare coverage and other out-of-pocket costs they are likely to face after they retire.

Ron Mastrogiovanni, chief executive officer of Health HealthView Inc., Danvers, Mass., is suggesting in a commentary that absolute-return funds could help.

HealthView is a company that develops and sells software tools individuals and others can use to analyst post-retirement health care costs.

Absolute return funds, introduced in 2008, are structured in such a way that managers can try to limit losses by moving assets from one class to another.

Absolute return fund managers can use any asset class that will enable them to protect principal and achieve a targeted rate of return, Mastrogiovanni says.

Fund managers try to offer a return that is higher than the return on Treasury bills, rather than trying to meet stock market performance benchmarks, Mastrogiovanni says.


The Chicago & Northeastern Illinois Association of Health Underwriters, Ingleside, Ill., has given the Edward H. O’Connor Memorial Distinguished Service Award to John Rippinger, president of Resource Brokerage L.L.C., Schaumburg, Ill.


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