Obama blames insurers for health care reforms delays

In his speech on health care at Glenside, Pennsylvania, for promoting his health care plan , President Obama repeatedly said, “I am kind of fired up”, in the same tempo as he used to address the crowds during his presidential campaign.

President Barack Obama and his top health care officials recently stepped up attacks on US insurers on their arbitrary actions in increasing insurance premiums, as part of his efforts to mobilize public opinion and to persuade lawmakers to back US health care legislation that, among other things, stipulates that all Americans would be required to avail health insurance coverage.

Obama’s signature piece of legislation on health care is designed to cover 40 million Americans who lack health insurance coverage, while reducing medical costs, and to give the US government fresh powers to regulate insurance rate increases. The legislation is expected to bring in widespread changes to US health care in 45 years. But it still faces opposition from Republicans and some Democrats on various counts.

The White House has already spent a year trying to pass health care reforms and it has paid a heavy political price to the president and his party in terms of falling poll numbers and as the stalled health care reform bill has slowed down Obama's wider agenda.

Apart from insurance firms the health care reform also faces opposition from lobbies representing drug companies and health care industry. When health care legislation was drafted in 2009 the drug companies were asked to support the legislation in return for not allowing imports of drugs from foreign countries.

Pleading on behalf of the people, Obama recently said that lawmakers are oblivious to the suffering of ‘heartland Americans’, and he added, “Those of us in public office were not sent to Washington to do what’s easy.”

Obama accused insurance firms of making ‘a cynical calculation, that even if rate hikes cost them customers, they could rake in more cash through higher premiums on remaining plan holders.’

"The United States Congress owes the American people a final up-or-down vote on health care. It's time to make a decision," Obama said recently in Pennsylvania, the state that helped him claim presidency in 2008. “We can’t have a system that works better for the insurance companies than it does for the American people,” Obama said.

"Every year, they drop more people’s coverage when they’re sick and need it most. Every year, they raise premiums higher and higher," Obama said.

“They will keep on doing this for as long as they can get away with it,” Obama said. “So how much higher do premiums have to rise until we do something about it? How many more Americans have to lose their health insurance? When is the right time for health insurance reform?" Obama insisted that the right time to pass the legislation is ‘right now.’

Parodying the pitches made by insurance firm executives to investors in their companies, Obama quoted them as saying 'we are in the money; we are going to keep on making big profits.’

Also Obama cited the plan of WellPoint Inc. for a 39 per cent rate increase for some policyholders in California. Both he and Kathleen Sebelius, the Health and Human Services Secretary, also referred to the conference call held by ‘Goldman Sachs Group Inc. in which an executive from the London-based insurance broker Willis Group Holdings Plc said price competition has decreased and insurers are willing to “walk away” from clients.’

It may be noted, recently, Sebelius wrote to heads of insurance giants UnitedHealth Group Inc., WellPoint Inc., Aetna Inc., Health Care Service Corporation and CIGNA HealthCare Inc. reiterating a request that they disclose how much of premiums go towards customers’ medical care, as well as administrative costs, executive salaries and profit.

The insurance industry CEOs met with Sebelius on March 4 at the White House. Stephen Hemsley, CEO at Minnetonka, Minnesota-based UnitedHealth, said in an interview afterwards that the industry agreed on the need for transparency and was waiting for details from the administration.

Meanwhile Karen Ignagni, president and CEO of the trade association, said in remarks at the group’s national policy meeting recently, “Our industry strongly supports health-care reform because we recognize that the current system is unsustainable,” and added “Unfortunately, the path that has been followed is one of vilification rather than problem-solving.”

According to trade groups, Obama needs to find ways to reduce medical costs and rather than attacking insurers. But the meeting at a Ritz-Carlton hotel in Washington is being targeted by demonstrators pressing for passage of the healthcare legislation. The organizers said they will attempt citizens’ arrests of insurance company executives and Ignagni, who opposes the current bill.

One of the complaints of the Republicans is that Obama's health care plan would mean higher taxes and the costs would be partly paid for by cuts to government health care plans for elderly people. But President Obama maintains that his approach would cut costs, expand access, rein in abuses by health care insurance firms and help reduce the rolls of more than 40 million people in America who lack health coverage.

There are many ordinary people, especially the students’ community, who fear that Obama Administration plans to jam the Student Loan program through at the same time as the Health care bill, and put college students to hardships.

There are legislators who wants the House to ditch legislation it approved in November and pass the Senate's version, coupled with ‘fixes’ to that bill, but the approach is highly risky as some conservative Democrats oppose it.

According to the former US Secretary of Labor, Robert Reich, only a ‘big, national, public option’ can force insurance companies to cooperate, share information, and reduce costs. He said that scattered, localized ‘insurance cooperatives’ are too small to do that and are ‘designed to fail’ because of opposition by the moneyed forces opposing the health care reform.

One of the major obstacles to implementing any US healthcare reform that does not benefit insurance companies and the private health care industry is the power of their lobbyists. In a June 2009 NBC News-Wall Street Journal survey, 76 per cent of the people said it was either ‘extremely’ or ‘quite’ important to ‘give people a choice of both a public plan administered by the federal government and a private plan for their health insurance.’

According to the Institute of Medicine of the National Academy of Sciences, the United States is the only wealthy industrialized nation that does not provide health care coverage to all its citizens. Those in favor of universal health care argue that the large number of uninsured Americans creates direct and hidden costs shared by all, and that extending coverage to all would lower costs and improve quality.

Now Obama is mounting pressure on the House of Representatives to back his health care plan by March 18, when he leaves on a trip to Indonesia and Australia. Obama wants House Democrats to approve the bill that has already passed the Senate. Required changes then would be made to the legislation through reconciliation, which would require a simple majority of votes in the Democratic-controlled Senate.