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WellPoint takes a swipe

Posted by: Julia Eisman on Oct 23, 2009

In what's becoming a weekly move from the insurance industry, yet another report has surfaced by an insurance company which is (shockingly) anti-reform. It seems that now that Congress is trying to clamp down on their egregious behaviors (like how a rape victim was deemed uninsurable after she took an HIV test after being attacked), they're not very happy.

The latest report is from the country's largest insurer, WellPoint. The report claims that costs for individuals and small businesses will rise, with young people getting hit the hardest. It takes a look at how reform will impact different demographic areas, unlike AHIP which looked at national trends.

A senior adviser on the Senate Finance Committee was less than impressed with WellPoint's report:

How many fatally flawed insurance company reports do insurance companies need before their credibility is entirely shot?" said Scott Mulhauser, a senior adviser on the Senate Finance Committee. "This is akin to the tobacco companies commissioning another study claiming nicotine isn't addictive and cigarettes don't cause cancer.

WellPoint's criticism of the pending legislation is no surprise. According to the Huffington Post:

WellPoint, the nation's largest health insurance company in terms of membership, has become one of the poster children for why reform is needed. With 35 million customers, one of every nine Americans is a member of a WellPoint health plan. Its annual sales of $60 billion netted corporate profits of $2.5 billion last year.

According to a 2008 study by the American Medical Association, WellPoint controls the largest market share in 9 of 42 states studied (CA, GA, IN, KY, ME, MO, NY, OH, and VA), dominating 71 percent of the market in Maine, 58 percent of the market in Indiana, and over half the market in Georgia, Kentucky, and Virginia.

Which means....they have a lot (of profits) to lose when they're prohibited from dropping sick patients and cherry-picking the healthiest individuals. In other words, for the insurance industry, non-discrimination comes at a price. In California, they got a glimpse of this:

WellPoint hasn't been immune to these charges: Anthem Blue Cross of California, a WellPoint subsidiary, agreed to pay a $1 million fine and take back 2,330 people whose insurance was rescinded after they turned in bills for costly care earlier this year.

With premiums outpacing paychecks and millions more uninsured just in 2009 due to the high unemployment rates, it's difficult to take the insurance industry's anti-reform rhetoric seriously.

The truth is America has a lot to gain with health reform. Every state will see a huge increase in the number of people covered, and subsidies will be available to those families and individuals who are struggling with the cost. Reform will also put an end to insurance company practices of discrimination and mistreatment, even if it means bringing the insurance industry along kicking and screaming.