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To the Obama Administration’s Reported Surprise, Private Insurers Skirt New Health Care Law

Democrats were extra proud when they put a requirement that insurance companies cover children with pre-existing conditions in their new health care law. Now, I bet the CEOs at the country’s largest for-profit insurance companies are even more proud of themselves for easily finding a way around this regulation: simply stop offering child-only policies. From the Denver Post:

At least six major companies — including Anthem, Aetna, Cigna and Humana — have said they will stop writing new policies for individual children not covered by their parents’ or other plans, insurance officials said.

They blamed health reform mandates taking effect Thursday requiring companies that write such policies as of that date to also cover sick children up to age 19.

Of course, President Obama and the rest of the Democrats have already begun pretending to shake their fists in anger at the insurance companies for being evil and putting profits over people. From the Washington Post:

But officials of the Obama administration said the move contradicted a letter from the leader of one of the insurance industry’s most important trade groups after the law’s adoption in March. Karen Ignagni, president of America’s Health Insurance Plans, expressed support for the law’s provisions concerning children with preexisting conditions and promised to “fully comply” with them.

“We expect [insurance companies] to honor that commitment. Insurers shouldn’t break their promise and turn their backs on some of our most vulnerable Americans,” said Jessica Santillo, a spokeswoman for the Department of Health and Human Services.

Frankly, the complaining from Obama is just sad. Either it is hollow grandstanding, or Obama actually thought that the private, for-profit health insurance companies were honest brokers he could trust to not try to find loopholes in the new regulations. If it is the latter, President Obama’s much-touted intellect needs a reevaluation.

At this point, for Democrats to blame the for-profit insurance companies is pathetic. Private insurers are the scorpion in the story of turtle and the scorpion. They have proven for decades they will do anything to avoid regulation, and will always put profits over the health care needs of regular Americans. Heck, by law, as for-profit corporations, they are required to put profits over everything else. Democrats let insurance companies hop on their back, and now they are smack-dab in the middle of the river with them. Don’t scream when they sting you–it is just their nature.

Of course, watching this recent action should fill all Americans with dread. Democrats actually chose to expand coverage to millions by forcing them to buy insurance exclusively from these same misbehaving private companies. If Democrats really believe the job of the government is to insure every American, then they should have had the government do it directly–and more cost effectively–through expanding Medicare for all or a public option, instead of outsourcing it to untrustworthy private insurers that put profits before people.

Signs don’t point to sunny skies ahead

This most recent revelation, cutting out new child policies, combined with the latest massive and apparently unstoppable rate hikes is just more proof of what I spent months warning about: the new law leaves the health insurance companies completely unchecked and the regulations are almost meaningless due to a lack proper enforcement. Frankly, given the billions at stake, and the drive of the for-profit insurance companies to maximize profits, I don’t even know of a really well-designed regulator system could prevent insurers continuing to exploit loopholes.

This might be one of the first examples how, due to poor design, weak regulation, and weaker enforcement, the new law fails to live up to expectations, but I promise you (as someone who read the entire law thoroughly, which apparently even Sen. Max Baucus didn’t) it won’t be the last.

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Jon Walker

Jon Walker

Jonathan Walker grew up in New Jersey. He graduated from Wesleyan University in 2006. He is an expert on politics, health care and drug policy. He is also the author of After Legalization and Cobalt Slave, and a Futurist writer at