WSJ: Health Co-Ops Aren’t the Answer, Sept. 28, 2009
Private health insurers perform many complex and hard-to-replicate functions.
They issue policies and accept financial risks associated with the costs of providing care.
They perform actuarial analyses to track costs and price policies.
They design different benefit structures to meet varying needs.
They select, contract with, and monitor the quality of thousands of hospitals and doctors and other professionals who provide the services covered by their policies.
They assess evidence for which technologies and treatments provide value, and provide information to assist millions of individuals and employers with a range of health-care and health coverage issues
Most plans, especially the best ones, assist with coordination of care and management of chronic conditions, and help consumers save money and time by guiding them to better health decisions.
Typically, all of this is facilitated by highly sophisticated and expensive information systems, and many trained nurses and physicians.
“It took decades and billions of investment dollars, with some of the most sophisticated business minds, to build today’s major health insurance companies”.
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If we want greater competition for today’s health plans to drive down costs, revise the ground rules and create a competitive landscape across the nation for existing companies.
Start by allowing health plans to compete across state lines. Because of restricted competition, in a large number of states only one or two plans dominate the market.
Reduce the number of mandated benefits states impose on plans. They drive costs 20%-30% higher than they might be.
Encourage health plans to negotiate more aggressively than they do now with hospital monopolies that exist in many local areas.
Promote benefit designs that offer more affordable coverage, such as policies with higher deductibles and health savings accounts that foster greater consumer engagement and healthy behaviors.
A “public option” by any other name—including health-care co-op—just won’t fly. The real competitive force will come from putting more dollars into individuals’ hands and fewer into insurers’ hands, and by fostering true competition among existing insurers.
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Full article:
http://online.wsj.com/article/SB10001424052970204488304574429481529233414.html?mod=djemEditorialPage
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