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Insurers still in control in Obamacare

Obamacare is the nickname for the Patient Protection and Affordable Care Act, or PPACA for short. It has been a target for criticisms that range from valid concerns to groundless fear mongering, and soon the Supreme Court will decide whether the mandate to buy insurance is constitutional. But there is one fundamental problem with the law that is rarely mentioned. To understand that problem, you need some background.

America’s Health Insurance Plans is the main lobbying organization for the private health insurance industry – companies such as Anthem, WellPoint and Cigna.

If you went to their website in the years preceding enactment of the PPACA, you would have found their recommendations for health care reform. Those recommendations were based on their business model: profitability largely depends on trying to cover healthy people and avoid covering sick people. The basic structure of the PPACA almost exactly matches those recommendations.

First, the companies know that most of the population is healthy and won’t cost them much, so they wanted a mandate to force people to buy their product – that guarantees them a lot of extra income. But they also knew that most people can’t afford what they sell, so they wanted taxpayers to provide subsidies so that people could actually purchase the insurance the law required them to buy. Finally, they agreed to try to cover people regardless of their health status, but they wanted to be sure that sick people could still be unloaded onto taxpayers through government programs such as Medicare, Medicaid and state-run high-risk pools.

There are aspects of the PPACA that represent a big improvement, such as trying to stop companies from denying insurance for pre-existing conditions. Still, the basic structure of the law is very favorable to private insurance companies and not so favorable to taxpayers and patients. This is not surprising, given the amount of political influence these companies wield (for instance, a former executive from WellPoint helped write the law). In fact, back in 2009, Business Week reported that the insurance companies had “won” – that whatever shape health care reform would take, it was clear that it would be very close to what those corporations wanted.

Problems arise when we give that much control to companies whose financial survival depends on not paying for people when they are sick – they even refer to payouts for health care as a medical loss. For years there has been so much extra money in our health care system that those companies could easily provide shareholders with profits and also take care of sick people. But as health care costs go up, those companies are feeling pinched, and that means they are raising premiums, increasing copays and deductibles and creating even more onerous rules and restrictions. But the role of private insurance is so ingrained in our minds and in the minds of our politicians that we accept all of these costs and hassles without question. The real irony is that those companies will remain in control whether the PPACA is overturned or not.

In fact, private insurers manage the debate so effectively that unless you are poor, disabled or older than 65, you are forbidden to have any insurance other than what they offer. And that is the real problem with Obamacare.

It is structured to benefit corporations that are obligated to place the needs of shareholders over the needs of patients, and that costs us all. There are ways to change that, but we have to start by asking our politicians to create a health care system that isn’t designed for the benefit of companies that, by their very nature, consider our health care to be a “loss.”

Dr. Jonathan D. Walker is an assistant professor at IU Medical School in Fort Wayne and a partner with Allen County Retinal Surgeons. He wrote this for The Journal Gazette.

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