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How Did He Do? Insurance and Tort Reform (Part 2)

Posted by Jane Akre
Thursday, September 10, 2009 1:36 PM EST
Category: Major Medical
Tags: Health Care Reform, Uninsured, Underinsured, Accountable Care Organizations, Insurance, Obama, Joe Wilson

Big insurance providers did not take any hit in the stock market today. Tort reform oponents say it will not save money but hurt consumers.

IB News - How Did He Do?- (Part 1)

Insurance Not Hurt

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IMAGE SOURCE: Obama, Biden, Pelosi/ Fox News Web site

Mr. Obama said he had "no interest in putting insurance companies out of business," yet noted that profits often trump people.

“My guiding principle is, and always has been, that consumers do better when there is choice and competition. Unfortunately, in 34 states, 75 percent of the insurance market is controlled by five or fewer companies. In Alabama, almost 90 percent is controlled by just one company. Without competition, the price of insurance goes up and the quality goes down. And it makes it easier for insurance companies to treat their customers badly — by cherry-picking the healthiest individuals and trying to drop the sickest; by overcharging small businesses who have no leverage; and by jacking up rates.”

But if the stock market is any indication, insurers and their stakeholders are not worried. Instead of a major shakeup of a public option that insurers have claims would lead to their bankruptcy, health insurers shares climbed Thursday.

Reuters reports that UnitedHealth Group and WellPoint, the two largest health insurers, were little changed in morning trading. Aetna Inc was up about 1 percent and Cigna Corp rose more than 3 percent.

Wells Fargo analyst Matt Perry said in a research note. "Overall we view the speech as neutral to insurers."

Karen Ignani, President of the America’s Health Insurance Plans, the lobbying arm of the industry said insurers “agree the status quo is not sustainable” and support reforms such as eliminating exclusions based on pre-existing conditions and prohibiting insurers from basing premiums on a person’s health status or gender.

To make this possible, everyone needs to be required to have insurance to spread the risk, said Ignani.

Defensive Medicine

President Obama announced that demonstration projects in individual states could test ways to reform the medical liability system so doctors don’t have to practice defensive medicine, presumably raising the cost of health care.

The American Medical Association’s president was pleased Mr. Obama included medical malpractice freeform, reports the Business Journals.

“We cannot ignore this problem if health system reform is going to address the growing cost of care,” said Dr. J. James Rohack, president of the AMA.

But reducing accountability will not improve health care according to American Association for Justice (AAJ) President Anthony Tarricone. “The focus must be on reducing medical errors and improving patient safety.”

Estimates are that more than 98,000 Americans are killed every year by preventable medical errors. A recent investigative report, “Death By Mistake,” by the Hearst media group finds medical mistakes and hospital infections are blamed for 200,000 deaths a year.

Public Citizen, the consumer advocacy group, reports that about five percent of doctors are responsible for half of the medical malpractice in the U.S. that can result in permanent injury or death, and without discipline become repeat offenders.

Not being able to make these doctors accountable will only hurt patients who are severely injured says Joanne Doroshow, Executive Director of the Center for Justice & Democracy.

Proposals that end up shielding unsafe hospitals or grossly negligent doctors from accountability by intruding upon the legal system are terrible public policy. Medical errors are at epidemic levels and this proposal will not only fail to fully compensate catastrophically injured patients, but also will undermine restraints the civil justice system currently imposes on dangerous misconduct.”

More errors will be allowed to occur, she says, increasing cost, not reducing it. Without accountability through the courts, Doroshow says the cost of medical errors will be shifted from perpetrators to state Medicaid systems, hard-pressed to pay them.

Tort Reform, Lone Star Style

In her 2004 investigative report on tort reform in Texas, “Tort Reform, Lone Star Style,” journalist, Stephanie Mencimer uncovered that restricting legal penalties against wrongful corporate behavior was a disaster for consumers, workers and small business owners.

AP has provided the text of the president’s speech in case you missed it. #


3 Comments

Posted by Wayne Parsons
Friday, September 11, 2009 4:02 AM EST

Jane, look at that smile! Obama just proved that he cares about little else than ..... Obama. His concessions to the U.S. Chamber of Commerce, Big Insurance, doctors who want a pass on the 200,000 deaths fro preventable medical injuries and Karl Rove and Rush Limbaugh show him as the charismatic leader who will ruin the country. I just wrote to the White Hosue and to my Congressional delegation and told them that I am voting with my dollars and will NOT support any elected representive in any election who supports the Obama sell out on health care. Neil Abercrombie, a House democrat, is running for Governor in Hawaii. I ask all Hawaii voters to watch his vote on the Obama bill and vote against him if he sells out to Big Insurance. That's my 2 cents!

Posted by Wayne Parsons
Friday, September 11, 2009 4:02 AM EST

Jane, look at that smile! Obama just proved that he cares about little else than ..... Obama. His concessions to the U.S. Chamber of Commerce, Big Insurance, doctors who want a pass on the 200,000 deaths fro preventable medical injuries and Karl Rove and Rush Limbaugh show him as the charismatic leader who will ruin the country. I just wrote to the White Hosue and to my Congressional delegation and told them that I am voting with my dollars and will NOT support any elected representive in any election who supports the Obama sell out on health care. Neil Abercrombie, a House democrat, is running for Governor in Hawaii. I ask all Hawaii voters to watch his vote on the Obama bill and vote against him if he sells out to Big Insurance. That's my 2 cents!

Posted by Jane Akre
Friday, September 11, 2009 9:46 AM EST

Wayne-

I think there are at least two different schools of thought of that, IMHO. One is that in order to move a huge agenda, small incremental steps must be made, with compromise a huge component. A little bit of change is better than no change at all.

The other thought is to wait until one can have it all.... and in this partisan climate, wait means stall and no change.

This president risks alienating his base while trying to placate the unplacatable...He risks losing the support of both sides (one which he didn't have at all) for the small chance he can build bridges, realizing that staying the course is not an option. Change is never easy, but do we agree we need it?

Is it sort of like mediation? Neither side is supposed to be happy...

Comments for this article are closed.

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