The Deep, Complicated, and Expensive Web of Obamacare and Insurers

David Williams
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Posted: Nov 19, 2015 1:37 PM
The Deep, Complicated, and Expensive Web of Obamacare and Insurers

In another example of the Obama Administration’s Friday afternoon news dump, the Department of Health and Human Services (HHS) is holding what they call a “Pharmaceutical Forum” on November 20, the Friday before the Thanksgiving holiday. In typical Obama Administration fashion, the so-called “forum” is by invitation only. HHS has also not been transparent about how who is invited and only Thursday morning released the details on the panel speakers to the public.

The reality is that the rising cost of health care is an important and relevant issue that affects the lives of every American. And as HHS readily admits, this is a “multi-faceted problem with no one solution.”

If we are going to have a meaningful conversation about the total cost of health care, then we must look at what is really driving the rising insurance costs that are hurting families in every state across the country.

According to a study released this week by Avalere, the causes of health insurance premium increases in 2016 largely mirror the distribution of health care spending in the individual and small group market, with hospital and physician spending being the largest drivers of growth. The analysis also finds that premium increases for 2016 do not point to prescription drugs as having any sort of significant impact on premiums.

If the Obama Administration truly wants to address the heart of the issue of rising health care costs, why wouldn’t they use this forum as an opportunity to take a look at every angle and hear from every voice on this issue?

Despite promises from President Obama to keep health insurance companies “honest” and “accountable,” we continue to see the insurers padding profits and canceling coverage for the sick under Obamacare.

Friday’s forum is the latest example of the established coziness between the Obama Administration and health insurers. Even the New York Times has noted the relationship between insurers and the Administration has evolved “into a powerful, mutually beneficial partnership that has been a boon to the nation’s largest private health plans.”

In fact, the relationship between the government and insurers is so close that the Obama Administration is hiring directly from within the health insurance industry. Consider Andy Slavitt, a former executive at United Health. In July 2015, Slavitt was nominated to be Administrator at the Centers for Medicare and Medicaid Services (CMS) after a UnitedHealth group, called Optum, worked to help the Obama Administration repair the technical glitches of HealthCare.gov in the months after its launch.

And then there’s Marilyn Tavenner, the former head of CMS, who led the Administration’s efforts to enact Obamacare and was responsible for HealthCare.gov. In July 2015, Tavenner became the top lobbyist for the nation’s health insurance industry as the new president and CEO of America’s Health Insurance Plans (AHIP). In her new position, Tavenner’s duties include negotiating with Congress regarding the future of Obamacare from the voice of insurers. Many criticized the appointment, including Sen. John Barasso (R-WY), who said it shows how Obamacare has created a cozy and profitable relationship for some.

In another example, Joel Ario, the former Director of health insurance exchanges at HHS resigned in August 2011 to become Managing Director of Manatt Health Solutions, a Washington, D.C. firm that advises numerous health insurance companies. And Steve Larsen, who was running a key part of health reform as former head of HHS’ Center for Consumer Information and Insurance Oversight, stepped down in June 2012 to go to work for Optum, the subsidiary of UnitedHealth Group. Larsen’s involvement in approving UnitedHealth’s government contract for QSSI later came under congressional scrutiny based on potential conflicts of interest surrounding the deal. QSSI is a technology company that was hired to build the federal insurance exchange where UnitedHealth competes with other insurance plans to sign up new enrollees.

As the revolving door keeps spinning and the alliance between the health insurance industry and the Obama Administration grows deeper, health care costs continue to rise and the real losers in the equation are consumers. Meanwhile, HHS is actively working to pile all of the blame on pharmaceutical companies for rising health care costs, which is the obvious objective of the forum this Friday.

When is the Obama Administration going to stop ignoring the real drivers of health care costs and start actually protecting patients as the law was originally intended?