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Health Care Reform Not Working for Child-Only Policies

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By:
Date:
Location: Unknown

I continue to follow the fallout from the recently enacted partisan health care reform law. It seems every day we learn of another broken promise from the Administration from the new "reform" law.

The latest issue is that some health insurance companies can no longer afford to sell children-only policies because of the new law. Under the law, insurers are prohibited from denying coverage for children with pre-existing conditions. While this may sound good, in practice it is causing insurers to drop their child-only policies, or to charge more for sick children. Anyone who understands insurance can see why: when people know they can wait until they are sick to purchase coverage, that's what they will do. Why would you buy homeowner's insurance if you could just wait until the roof's on fire to do so? And since insurance works by spreading risk among pools of people, an absence of healthy people in the pool means prohibitively high risk and, in turn, prohibitively high prices.

Instead of creating this perverse incentive to wait to purchase health insurance, I would have preferred that we take measures to lower the cost of insurance for everyone, thereby ensuring the highest uptake with the healthiest risk pools. Strategies like allowing for the purchase of insurance across state lines, extending tax incentives to the purchase of individual coverage, and lowering the cost of health care with patient-focused policies. Simply put, we should have focused on lowering costs as a means of expanding coverage. As we're seeing now, promising coverage without addressing costs doesn't work.

Once again the Administration and leadership in Congress cannot keep the promises made while this partisan bill was rammed through Congress. For more information, read a recent New York Times story on this issue: http://www.nytimes.com/2010/10/14/health/policy/14health.html .

I warned that this health care reform law would do nothing to address the real problem in our health care system: cost. I am highly concerned about the consequences of this new law for children, and I will be following this issue closely


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