Thursday, September 10, 2009

What the insurance companies should do

On Tuesday, I told you what I think President Obama should do if he wants his health care plan passed by Congress. While I certainly can't claim to have his ear, his speech last night was at least a close approximation of what I envisioned in that post.

Don't be surprised when we hear tomorrow or the next day that Senate Majority Leader Harry Reid and Speaker of the House Nancy Pelosi are cracking the whip to get every last Democratic vote in line behind Obamacare with the "public option." I'd bet money that the advice he got privately from Rahm Emanuel and his other close advisors was very similar to my public version.

Just like HillaryCare in 1993, ObamaCare in 2009 is a make-or-break deal. He has to gamble big.

If he wins, he won't just get his health care package. He'll run the table through next November's mid-terms, ticking items off his agenda as a disciplined Democratic congressional majority rolls over GOP opposition to get those items done -- and the Democrats will likely maintain their majorities and their momentum all the way into 2012.

If he loses, he won't just be losing on health care. He'll continue to fumble along with a fractious Democratic majority that accomplishes nothing significant through the mid-terms. The Democrats might very well lose their majority in one or both houses of Congress in 2010, and if the GOP puts up a decent presidential candidate in 2012 he might even be a one-term president.

Those are the stakes for Obama.

Here are the stakes for the insurance industry:

Under this plan, it will be against the law for insurance companies to deny you coverage because of a preexisting condition. ... it will be against the law for insurance companies to drop your coverage when you get sick or water it down when you need it the most. ... They will no longer be able to place some arbitrary cap on the amount of coverage you can receive in a given year or in a lifetime. ... We will place a limit on how much you can be charged for out-of-pocket expenses .... And insurance companies will be required to cover, with no extra charge, routine checkups and preventive care ...

In my last post on ObamaCare, I put myself in the shoes of the President of the United States. Now I'm going to put myself in the shoes of the president of an insurance company. If I found myself in that position, I'd be getting my ducks in a row right now -- calling emergency board meetings, working out details with the company's officers, etc. I'd be ready to move the instant it became obvious that this bill was going to pass, and this is what my move would look like:

- I'd inform the company's policyholders that the company is going out of business at the end of the next billing cycle, that their policies will be canceled effective that date, and that they'll need to find coverage elsewhere;

- I'd inform the company's workers that their employment is drawing to an end; and

- I'd inform stockholders that the company's assets are to be liquidated through arranged profitable sale where possible and auction where necessary, and that after the company's debts are settled and liabilities zeroed out, each stockholder will receive a final dividend per share from any remaining monies.

I might or might not send a note to President Obama, Majority Leader Reid and Speaker Pelosi. If I did, it would be short and to the point:

Find some other business to run, asshole -- this one's no longer available.

The above is the only honest, reasonable, or even sane response to this nonsense. Unfortunately, I doubt there's a single insurance company president/CEO in the country with the balls to do it -- and I'd bet money that even if there is, his company's board will depose him before he can get within a mile of implementing it.

Instead, the insurance companies will just put their lobbyists to work finding ways to get over as part of the new system. They'll put the screws to us, screaming all the while that it's Obama putting the screws to them from one side of their mouths and telling their secretaries "make one check out to 'Democratic National Committee' and the other to 'Obama 2012'" from the other side. That's how they roll.

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