Monday, December 21, 2009
Business leaders worried about exchanges
The U.S. Senate is proposing the creation of government regulated "health insurance exchanges" designed to facilitate the introduction and purchase of new insurance products for the currently un/underinsured population. A group of 200 business leaders and university presidents, called the Committee for Economic Development, has warned that such exhanges are likely to fail due to the resultant lack of competition that will emerge in a restructured insurance marketplace. The group has cited a concern that adverse risk selection will occur if the exchanges tend to attract the sickest (and most costly) patients. The House bill includes language prohibiting such selection risk and the committee is recommending adoption of such language. Given how touchy things are on the Senate side and with a few key senators saying they will drop their support if there's movement back toward House language, expect the Senate's version of health exchange language to stick. Let's hope the Committee for Economic Development is wrong then.