Insurance Industry Offers Alternatives To Enforcing The Individual Mandate

Top health insurance lobbyist Karen Ignagni — the President and CEO of America’s Health Insurance Plans — has a solution for everything. Yesterday, just days after releasing a poorly received report on premium increases, Ignagni testified before the Senate HELP committee and insisted that insurance market reform is only possible if everyone buys into the system.

“If members of Congress are concerned about” imposing high penalties on individuals who don’t purchase coverage, “we’ve offered some alternatives to achieve universal participation,” Ignagni helpfully suggested:

- Higher rates in subsequent years: “If you don’t participate in year one, you pay more in subsequent years.”

- Loss of personal exemption: “If you didn’t participate you lose your personal exemption on the state level.”

- Auto enrollment: “We’ve been looking at auto enrollment for people who are eligible for subsidies.”

Watch it:

“There are ways to solve those problems, and we’re committed to working with you to solve the problems,” Ignagni said, in classic conciliatory form. “We don’t want to let Americans down. It’s very important. We promised that we are committed to this. Our industry is for-square behind it, but we have an obligation to explain how to make that happen.”

If penalties aren’t higher, premiums will go up and Ignagni’s solutions for getting more Americans into the system could play well on the hill. But she hasn’t solved the problem of affordability. The Senate Finance Committee lowered the mandate standards because it did not have enough money for a robust subsidy program or the political will to establish a public option (or other proposals that would have significantly lowered premiums). Now, the industry is asking Congress to design policies that strongly encourage Americans to purchase coverage without offering to lower premiums.