By Ethan Rome - Executive Director, Health Care for America Now
While the Republican candidates for President made it clear in their debate this week that they are happy to let uninsured people die if they have a serious illness, the Republicans in Congress are plotting to make people with insurance pay even more for their coverage to boost insurance company profits. How? By stealing nearly $2 billion in rebates that insurance companies owe consumers and small businesses and giving the money back to the insurers.
At a time when families are struggling to make ends meet, this would be an astonishing transfer of money from consumers to the already overflowing coffers of the health insurance industry, whose top five companies alone made $11.7 billion in 2010.
The heist is being promoted by the Republicans on the House Energy and Commerce Health Subcommittee. They want to repeal a provision of the Affordable Care Act, known as the medical-loss ratio (MLR). The MLR sets a minimum percentage of premiums (80 percent for individual and small-group plans and 85 percent for large group plans) that insurers spend on actual medical care instead of wasteful overhead, excessive profits and bloated executive compensation. Under the law, companies that fall short of the minimums must rebate the difference to consumers. The GOP thinks repealing this requirement is such as good idea in this weak economy that they're holding a hearing on it Thursday.
The rebates are huge because insurance companies overcharge so much. The Department of Health and Human Services estimates that consumers will receive $1.4 billion in rebates in the coming year. The National Association of Insurance Commissioners says the rebates could hit $2 billion.
Already the MLR rule is saving consumers money. Some insurance companies in California, Connecticut, Michigan and North Carolina have already rolled back rates, declared premium holidays or issued direct refunds. In Connecticut, policyholders saw rate decreases of as much as 19 percent. That's how the law is supposed to work - it forces insurance companies to change their pricing and makes them pay if they don't.
But the GOP cares more about the insurance companies than consumers and small businesses. You might even say the industry and other corporate interests and campaign contributors own the Republicans in Congress.
In fact, the health care and insurance industries have given the Republicans holding Thursday's hearing more than $21.7 million in campaign contributions, according to a new analysis by Public Campaign Action Fund. Maybe that's why they are willing to take so much money from consumers and give it to health insurers even as they rake in record profits on the backs of families and businesses being crushed by a bad economy.
We desperately need to help working and middle-class families, support small businesses and put America back to work. That's what our representatives in Congress should be doing, not robbing money from people trying to keep up with their bills.
Cross posted on the Huffington Post here.