Health insurers prepare for new landscape
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Scores of health insurance officials nationwide jammed the conference lines last week to listen in on an informational session with the Blue Cross Blue Shield Association.
The discussion topic? We'll give you three guesses.
"Plans are really hungry for information," said Brett Lieberman, spokesman for the Blue Cross Blue Shield Association. "We're just spending a lot of time digesting, at this point."
Having spent more than a year opposing various components of President Barack Obama's health care reform plan, insurers must now prepare for the reality of a new business landscape -- new rules, new pricing models, new taxes and new customers.
"This is the law of the land now," Mr. Lieberman said. "While we've been at this for well over a year, this is really the starting point. This is the beginning, not the end."
Barring a congressional repeal or a judicial Hail Mary, the health care reform bill will begin taking effect in stages over the coming years. Insurers will spend the coming months getting a handle on what, precisely, the new law means to their existing business paradigm.
"I think Highmark has been planning for some of this for a while, consistent with where we thought health care might go," said Michael Weinstein, spokesman for Highmark Inc., Pittsburgh's largest health insurer.
Highmark, like many health insurers, has been focusing to a greater degree on the retail sector and the individual product market. That focus is well aligned with the retail feel of the new "health insurance exchanges," a key provision within the bill. President Obama said last week that he intends to purchase insurance through the exchanges when they are put into place, in 2014.
There are more than 2,000 pages of legislation to sift through and to fully comprehend the details of the law, Highmark -- a non-profit Blue Cross-Blue Shield insurer -- will be leaning on its national accrediting organization, the Blue Cross Blue Shield Association, for interpretive expertise.
"We don't have a huge staff for government affairs," Mr. Weinstein said, and what staff Highmark does employ is better versed in state law and regulatory matters.
Other insurers will be teaming with America's Health Insurance Plans (AHIP), the National Association of Insurance Commissioners, and the U.S. Department of Health and Human Services to interpret the details of the law.
For example, insurers -- which have said that the reform bill will lead to increased premiums -- are coming to grips with a mechanism that seeks to soften premium rate hikes. That mechanism is a limit on what's called "loss ratio," which theoretically sets thresholds on how much money an insurance company can steer away from medical care and toward profit and administrative overhead.
First Published March 30, 2010 12:00 am
