The Noble Eightfold Path of Consumer Protection


All the buzz in the blogosphere continues to be about the idea of a public option inside health insurance exchanges. But it’s important to understand that for most people this isn’t going to make any difference. The “exchange” is for people who don’t currently have insurance, and whose employers aren’t inspired to offer insurance by a “pay or play” mandate. For those of us outside the exchange, the core of health reform is this eight point plan to make health insurance better by blocking dirty tricks by private insurers.

As the White House lays it out:

No Discrimination for Pre-Existing Conditions
Insurance companies will be prohibited from refusing you coverage because of your medical history.

No Exorbitant Out-of-Pocket Expenses, Deductibles or Co-Pays
Insurance companies will have to abide by yearly caps on how much they can charge for out-of-pocket expenses.

No Cost-Sharing for Preventive Care
Insurance companies must fully cover, without charge, regular checkups and tests that help you prevent illness, such as mammograms or eye and foot exams for diabetics.

No Dropping of Coverage for Seriously Ill
Insurance companies will be prohibited from dropping or watering down insurance coverage for those who become seriously ill.

No Gender Discrimination
Insurance companies will be prohibited from charging you more because of your gender.

No Annual or Lifetime Caps on Coverage
Insurance companies will be prevented from placing annual or lifetime caps on the coverage you receive.

Extended Coverage for Young Adults
Children would continue to be eligible for family coverage through the age of 26.

Guaranteed Insurance Renewal
Insurance companies will be required to renew any policy as long as the policyholder pays their premium in full. Insurance companies won’t be allowed to refuse renewal because someone became sick.

If you can make it stick, and if you can cash these eight principles out in a reasonable way, this would transform health insurance for the majority of Americans. And while I think it’s safe to say that the public option is dead in the Senate Finance Committee (though it will very possibly be revived in conference), the negotiations around these issues are very real. There’s some talk of not fully applying all of these rules to existing health plans, or else of phasing it in very slowly. And many of these phrases are somewhat ambiguous and could be defined in different ways. A good health plan will be very tough on these eight points, will apply them broadly, and will implement them relatively expeditiously. A not-so-good plan won’t.

This is a big deal. It’s not to say that people need to shut up about the public option, but it is to say that people need to keep their eyes on all aspects of the ballgame. There’s important stuff happening in this area and members of congress need to hear that people want it done right.