White House and Insurers Battle Over Kids' Care

Can insurance companies get around health care reform?

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With the dust barely settled after a long health-care battle, insurers launched a counteroffensive. They argued that they were not legally required to guarantee coverage for children with pre-existing conditions until 2014. But President Obama insisted that the legislation immediately enforces guaranteed coverage for children. At issue was not Democrats' intent, which was clear, but the specific language of the new health care laws. Insurers, under public pressure from the White House, have since conceded the point, agreeing to extend the coverage as required in the bill. But the skirmish could foreshadow a contentious relationship between health insurers and the government, which is attempting sweeping new regulations over the industry.

  • 'Weasel Words' and 'Undermining'  The Boston Globe's Derrick Jackson deplores "weasel words from insurance industry officials" that he says are just the beginning. "Thus, the undermining is already underway. On one hand, the insurance industry purports to be a team player." But their actions suggest otherwise.
  • Insurers Will Always Want to Deny Coverage  Liberal blogger Jay Ackroyd scoffs, "their business model, necessarily, is finding ways to deny treatment. The firms that can provide the least treatment will acquire the ones who provide more. Or rather, have acquired them."
  • White House Proves It Can Pressure Insurers  The Washington Post's Ezra Klein says insurers "have a lot to lose from a fight with the administration." He says there are "plenty" of ways that Health and Human Services Secretary Kathleen Sebelius can "make the insurance industry's life very, very difficult." Although the insurers may have been legally right on this issue, their acquiescence proved the White House retains influence.
  • Bending Under Bad P.R.  The Washington Monthly's Steve Benen wonders whether the reversal was "the result of stern administration warnings or fear of a p.r. nightmare." Suggesting insurers realized this would be an "unhelpful fight," he asks, "do insurers really want to fight to deny coverage to sick children?"
  • This Is Not Such a Big Victory  Time's Kate Pickert sighs, "Although insurers have promised to sell insurance policies to families with kids with pre-existing conditions, there is nothing to stop the insurance companies from charging whatever they want." So even if they cannot deny sick children coverage, they can still set outrageous and unaffordable rates until 2014, when more regulations kick in.
  • The Other Gaping Loophole  Naked Capitalism's Yves Smith points it out: "fraud and intentional mispresentation." In this situation, insurance policy holders who have an error on their paperwork or who failed to report something may have their coverage canceled. Insurers often do this for policy holders who develop an expensive ailment, and Smith says they will continue to do so.
This article is from the archive of our partner The Wire.