Health Insurance Stocks Rise After Defeat Of Public Option Amendments

Yesterday, the Senate Finance Committee voted down both the Rockefeller and Schumer amendments, which would have added a public insurance plan to the committee’s bill. As the Wall Street Journal reports, shares in health insurers Humana and UnitedHealth shot up following the votes:

Shares of companies that operate private health plans turned higher or trimmed losses in afternoon trading Tuesday after a Senate committee rejected an amendment that would have created a government-run insurance option. Humana Inc. (HUM) shares, which had been down earlier, were recently up 1% at $38.41. UnitedHealth Group Inc. (UNH) shares gained 3 cents to $25.83.

Private health insurers have bitterly fought the creation of a public insurance option, fearing that such an option would cut into their profits. Yesterday, Life And Health Insurance News reported that the insurance industry has responded positively to the defeat of the public option amendments. “We are pleased by the rejection of both the Rockefeller and Schumer amendments,” said Tom Currey, president of the National Association of Insurance and Financial Advisors. Janet Trautwein, president of the National Association of Health Underwriters, also told the press that her organization is pleased by the failure of the Schumer and Rockefeller amendments.

Meanwhile, disgraced former CEO of Columbia/HCA Healthcare Rick Scott, who heads the anti-reform front group Conservatives for Patients Rights, released a video where he called yesterday’s vote “a great day.”

If anyone knows how the insurance industry feels about protecting its profits from the introduction of a new public plan, it’s whistleblower Wendell Potter, who left Cigna last year over its opposition to health care reform. Potter appeared on Democracy Now! this morning and told host Amy Goodman that the Finance Committee advancing legislation without a public option marks the “first time” that a health reform bill has been put together that the industry supports:

POTTER: Yeah, this is the first time that the insurance industry has really seen great opportunity in healthcare reform, with an individual mandate, which would require all of us to buy insurance if we are not eligible for a public, government-run program, which, fortunately, many people are. We would have to buy it in the private market from insurance companies, many of whom—many of which are for-profit companies. … So billions and billions of taxpayers’ dollars will flow right into the treasuries of these big for-profit insurance companies. So we will be essentially paying a tax that will help support these insurance companies. It will be an enormous bailout of the health insurance industry.

Watch it:

Potter also told Goodman that while numerous members of Congress sought out his advice as they crafted health care legislation, “not once” did he ever hear from Senate Finance Committee Chairman Max Baucus’s (D-MT) office. He ended the interview by saying that there should be a debate about single-payer health care in the United States, and that he thinks “it will eventually take a social movement to get the kind of healthcare that we need in this country.”