KASSEBAUM-KENNEDY: Clinton Threatens Insurers

      President Clinton yesterday announced that health insurance companies who attempt to circumvent the requirements of the Kassebaum-Kennedy law will be denied contracts for federal workers health insurance -- "the nation's single largest market." Newsday reports that the president is "[t]aking full advantage of an issue that Democrats hope to capitalize on at the polls in the fall." Clinton said, "Unfortunately, reports have shown that some health plans are paying no more than lip service to the requirements of the law" (Yan, 7/8). CNN's Eileen O'Conner reported that the Clinton "letter or spirit" of the law reference alludes to insurers who make coverage affordable for high-risk recipients, but charge "140% to 600% of the standard premiums for their insurance." Apparently, Clinton plans to target these companies as well ("CNN Today," 7/7). Newsday reports that the administration offered "no details on the scope of the problem and declined to identify violators" of the law. Glenn Pomeroy, president of the National Association of Insurance Commissioners, described the problem as "isolated" (7/8).

It Ain't So
      "Insurance industry representatives derided the move as a campaign-year publicity stunt," the AP/Philadelphia Inquirer reports. Charles Kahn, head of the Health Insurance Association of America, said, "They (White House officials) don't even know if there are any violators. This is such an election year stunt it really gives health policy making a bad name" (Sobieraj, 7/8).HIAA spokesperson Richard Coorsh said, "It's totally unnecessary and basically it's piling on when the insurance industry is viewed as the villain of opportunity in an election year. We don't believe there are widespread problems" (Newsday, 7/8). Kahn added that the HIAA supports the Kassebaum-Kennedy law. But, he added, "Rather than seeking election-year advantage by attacking the private health insurance industry, the president would better serve the public by promoting state programs that provide affordable coverage under the Kassebaum-Kennedy law. ... [H]e gives election-year pandering a bad name" (HIAA release, 7/7). David Lack, president of the Council for Affordable Health Insurance, said, "Once again, Mr. Clinton is trying to create a crisis where none exists in order to design a feel-good federal response" (CAHI release, 7/7). At the same time, health care advocates applauded the president's move, but said it didn't go far enough to address the problem of high premiums for coverage purchased under Kassebaum-Kennedy (Newsday, 7/8).

Rocky Mountain High
      In related news, the Denver Post reports that two 1994 Colorado General Assembly laws have made it easier for small businesses to buy health insurance, and that the number of Coloradans covered by such small plans "has risen by nearly 100,000," according to the state Division of Insurance. The laws prevented insurance companies from basing premiums on the "health status of members of small groups," which often caused insurers to charge exorbitant premiums for a group because one person had a health problem. Colorado Insurance Commissioner Jack Ehnes said, "Currently, the access to coverage is better than it was. The cost may be a little higher on the front end, but there are protections in place that keep it from creeping way up" (Algeo, 7/8).