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How will Obama’s Reform Affect Individuals and Health Insurers Alike

Jun 15th, 2009

reformObama’s Reform and how it will Affect Individuals and Health Insurers Alike.

The state of healthcare in America is in dire straits, 47 million Americans are without any healthcare at this time and many more are under-insured.  Unlike any other industrial country in the Western hemisphere, the United States is the only country without universal healthcare coverage for its citizens. Universal healthcare is needed and has proven to be an affective healthcare system in other major countries of the world providing public access.  Is it not important for the citizens of the USA to have proper health coverage?  Questions right or a privilege always surface.  These questions will probably be debated for years to come but why has the USA not adapted universal health to date?

People will argue that public health care could never work in the USA due to the size of the population.  The population of countries already using a public healthcare system is much smaller than that of the United States.  Public officials of all levels of government have visited neighboring Canada to speak with Canadian government officials and study their healthcare system now for over 20 years.  However, each time whether it is a president of the United States or the Mayor of New York City, they go back home shaking their heads and saying due to the size of the population it would be too expensive to implement.

Another reason for not having a public system at this time is the healthcare infrastructure at present.  Healthcare in the United States is a function of the private sector not the public sector.  Furthermore the system is not based upon individual or family access; instead the USA employs an employer-based system where the onus of health coverage is placed upon the employer to provide for healthcare.

At present the system is crumbling, less and less employers are providing coverage for their employees and small companies are feeling the brunt in these less than favorable economic times.  The crisis is that even though employers are finding it hard to afford group insurance coverage for their employees due to rising healthcare costs in a world recession, the individual and family is faced with even higher costs when they try to obtain private healthcare coverage.  The costs are astronomical and it is getting to the point that only the wealthy and financially stable upper middle class can afford to get personal and family insurance at this time, yet people who are not with means are suffering at this time. Americans want healthcare, they just cannot afford to purchase it.

President Obama is in favour of public health care to go hand in hand with the private healthcare system currently in place. Obama has said that Americans need to have that option available to them.  Public health care will also provide competition for the private sector and as Obama put it, “keep them honest.”  Obama expects to have a Bill tabled by October concerning a major overhaul in the health care system.

Although the populace is divided on the issue of whether or not there should be both a public and private healthcare system available to all Americans, it comes as no surprise the health insurance companies would be against this plan.  Let’s face it; it would cut into their profits.

The AHIP (American Health Insurance Plans) is the national association for over 1,300 insurance companies providing health care coverage to over 200 millions Americans.  In order to remain competitive they to have announced major cost saving reforms to keep down the rising costs of healthcare. They intend on doing this by standardizing administrative cost throughout the system.

Insurers now feeling the crunch of a different system in the wind are now promising to make healthcare more affordable for personal and family coverage.  They are considering lowering the coverage so that it is not based on the healthy versus the ill and they will sell insurance even to people with pre-existing conditions.  This major reform will make health care more affordable to an additional 50 million people.  They have not yet addressed the issue of people in small businesses, or self-employed who remain uninsured at this time.

This market is very lucrative for private insurers, and some are not even willing to acknowledge that small business and self-employed individuals need health care reform as well.  Well Point, for example states the system in place for small businesses and self-employed works well as it is.  Well Point is a Blue Cross provider.

Blue Cross Blue Shield is actively against Obama’s healthcare reform.  Where Obama states that the crisis in the healthcare industry is what is adding to the current recession, naturally a private insurer who stands to lose money if there is competition from the public sector will strongly disagree.  They claim that providing insurance to the uninsured at this present time would only jack up the cost for people who are currently insured, as they will bear the brunt.  Blue Cross Blue Shield is planning a very aggressive campaign to oppose Obama’s reforms.  They stand to lose a lot of money should the reform go through.

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