Statement on Senate health care reform legislation released by Karen Ignagni

Karen Ignagni, President and CEO of America's Health Insurance Plans (AHIP), released the following statement today on the Senate health care reform legislation:

"The debate before the country is not whether insurance market reforms are needed. They are. The debate is not about whether all Americans should have health care coverage. They should. The debate is about whether the current legislation can work, bend the cost curve, and be sustained.

"Health plans proposed a complete overhaul of insurance market rules and new consumer protections to ensure all Americans have guaranteed access to affordable, portable coverage, and we continue to support these objectives. While the bill makes important improvements in access and takes steps towards cost-containment, it lacks accountability to ensure that costs will be brought under control. The legislation also contains provisions that go into effect in the next year that will create significant disruption and instability for individuals, small businesses, and seniors.

"These issues can and should be resolved if the legislation is to meet the expectations of the American people that they can keep their current coverage if they want to and that health care services will be more affordable."

Barriers to affordability:

• A new $70 billion premium tax that will increase the cost of health care coverage for millions of Americans and fall primarily on small businesses and those who purchase coverage in the individual market.
• More cost shifting to patients with private coverage as providers are forced to make up for hundreds of billions in reduced Medicare payments.
• New market and rating rules that will increase premiums for individuals and small businesses with coverage today.

Disruptions for current policyholders:

• New regulatory requirements and benefit mandates that go into effect beginning next year - before access provisions go into effect - that will cause major disruption for millions who have already enrolled in their plans for next year.
• A new federal plan that would preclude many high-quality plans from participating and increase complexity in the exchanges.
• Arbitrary caps on administrative costs that will undermine essential health care services, such as disease management and care coordination programs, investments in health information technology, programs to root out fraud and abuse in the health care system, and new administrative simplification requirements.
• Major cuts in Medicare Advantage benefits beginning next year that will ultimately result in millions of seniors losing their current coverage.