People deserve better than WalkerThe Walker Administration is seeking to undermine a key national consumer protection which caps excessive health insurance industry profits and overhead.
By: By Robert Kraig , Superior Telegram
The Walker Administration is seeking to undermine a key national consumer protection which caps excessive health insurance industry profits and overhead.
On Oct. 25, without any public announcement, (Citizen Action of Wisconsin actually had to inform the media and legislators), Walker’s Insurance Commissioner quietly filed an official request asking the federal government for a three-year waiver from new standards requiring health insurance companies, which sell policies directly to consumers, spend at least 80 percent of premiums on medical care.
The reform went into effect this year, and is part of the national health care law, the Affordable Care Act.
Given the pain skyrocketing health insurance premiums are causing throughout Wisconsin, and rampant health insecurity that threatens so many working families, it is stunning — and highly revealing — that the Walker Administration is seeking to put industry profits ahead of the interests of consumers.
Health advocates consider the new federal standards to be modest, and many believe the insurance industry should be forced to spend an even higher percentage of premium dollars on medical care. In fact, many nonprofit insurers in Wisconsin spend 90 percent to 95 percent of health insurance premiums on medical services, and the overhead for Medicare is even lower.
The Walker Administration is siding with national for-profit health insurance corporations that are enjoying record profits against Wisconsin workers struggling to pay for health insurance.
The Walker Administration waiver request to U.S. Health and Human Services Secretary Kathleen Sebelius asserts that struggling health insurers will leave the market if they have to rein in profits and overhead too quickly.
No convincing evidence of their financial distress was provided in the letter and 25 pages of accompanying documents. In fact, included on the list of insurers who that are not meeting federal standards on profits and overhead in Wisconsin are large hyper-profitable national insurance conglomerates such as Humana and United HealthCare.
Both have posted double digit increases in profit, and together are on track to earn just under $7 billion this year alone.
If the Walker Administration’s waiver request is approved, it will hit health insurance rate payers directly in the pocket book.
The Affordable Care Act requires health insurers who exceed the new maximum levels of profits and overhead have to pay rebates back to consumers.
According to the documents accompanying the federal waiver request, health insurers not meeting the standard are projected to pay back $14 million in rebates to Wisconsin consumers over the next three years.
The Walker Administration is saying that highly profitable health insurance corporations need this money more than Wisconsin workers struggling to make it through the worst economic downturn since the Great Depression.
We strongly disagree.
The people of Wisconsin deserve better. The Obama Administration should block Walker’s blatant giveaway to big health insurance by enforcing the law as it was written.
Robert Kraig is the executive director of Citizen Action of Wisconsin, www.citizenactionwi.org. You can read the full Walker Administration federal waiver request at http://cciio.cms.gov/programs/marketreforms/mlr/states/Wisconsin/wi_mlr_request_10252011.pdf