Insurance Agents, U.S. Chamber Unhappy with Healthcare Reform

Independent insurance agents are among those today expressing their disappointment with the health care reform bill passed by the U.S. House of Representatives. The House approved the Senate-passed bill and also approved a separate bill that makes changes agreed to by President Barack Obama and Democrats in both the House and Senate.

The agents say they feel the bill does not do enough to control healthcare costs and they oppose the new taxes contained in the bill.

Meanwhile, the U.S. Chamber of Commerce is vowing to launch its largest outreach program ever to hold lawmakers who voted for the bill accountable.

“The Big ‘I’ is greatly disappointed that after months of negotiations, hearings, debates and votes in multiple Senate and House committees we seem to be back on square one: a bill that does little to stem the skyrocketing cost of health care and will be financed on the backs of small business during one of the most delicate financial periods in American history,” said Robert Rusbuldt, president and CEO of the Independent Insurance Agents & Brokers of America (IIABA or the Big “I”).

“Health care reform must first and foremost address the rising costs of health insurance and this bill does nothing in this regard,” said Charles Symington, Big “I” senior vice president of government affairs.

The Big “I” said that according to the Congressional Budget Office (CBO), small businesses will see little to no decrease in their monthly premiums and individuals will see an increase of 10 to 13 percent.

Starting in 2018, under the bill there would be a tax on health plans costing $10,200 or more for individuals and $27,500 or more for families. The bill also increases the Medicare payroll tax and applies it to investment income as well as wages for individuals making more than $200,000, or married couples above $250,000. The tax on investment income would be 3.8 percent.

Under the bill, employers are not required to offer health insurance coverage but companies with 50 or more employees would be charged a $2,000 per-employee fee if the government subsidizes their employees’ coverage.

“A tax increase, especially during today’s tough economic climate, will put many small businesses in the untenable position of deciding between job cuts, employee pay cuts, or shutting their doors,” said Symington.

The Big “I” also said it was disappointed there is no medical malpractice reform in the bill. The Obama Administration is funding pilot projects on alternatives to litigation instead.

Janet Trautwein, CEO of the National Association of Health Underwriters (NAHU), which also represents health insurance brokers, said the high cost of healthcare is the primary problem and agrees that the legislation does little to rein them in.

“Health care costs are rising at an unsustainable rate, and if we don’t get these costs under control, we will no longer be able to pay for the top-notch medical care that most Americans enjoy today,” she said when the president unveiled the plan.

The NAHU leader has also criticized the cuts in Medicare, the individual mandate and the taxes and fees.

“We don’t need to jeopardize the Medicare program by making cuts in the wrong areas. We don’t need to jeopardize job growth and economic prosperity by burdening our employers with a new mandate to provide the government’s idea of appropriate health care coverage to those the government decides it should be provided to and at a cost determined by the government. We don’t need new market reforms that come at a cost so high that no one can afford to buy the reformed coverage. And we most certainly do not need tens of billions of dollars in new taxes and insurer fees that will result in increased premium costs for all privately insured Americans,” she said.

The agents’ criticisms are in line with those of the nation’s health insurers, although they support an even stronger individual mandate.

“The access expansions are a significant step forward, but this legislation will exacerbate the health care costs crisis facing many working families and small businesses, said America’s Health Insurance Plans (AHIP) President and CEO Karen Ignagni in a statement.

AHIP has said a $70 billion premiums tax on insurers in the bill would be passed on to patients, raising the cost of coverage.

Also, the legislation imposes $200 billion in cuts to Medicare Advantage that Ignagni said “will cause massive disruption for the more than 10 million seniors enrolled in the program.”

The U.S. Chamber of Commerce blasted the bill and vowed to work to unseat lawmakers who voted for it.

“The House made a wrong and unfortunate decision that ignores the will of the American people. Americans will not be fooled. This $900 billion, 2800 page bill is not health care reform. It fails to fix what is broken and risks breaking what already works,” said Chamber President and CEO Thomas J. Donohue.

Donohue said this organization will work to “fix its flaws and minimize its potentially harmful impacts.” And he vowed that through the “largest issue advocacy and voter education program” in its history, the Chamber will “encourage citizens to hold their elected officials accountable when they choose a new Congress this November.”

Features of the reforms have also upset some state lawmakers. More than 36 states have weighed resolutions or bills that oppose various aspects of the reform plan, according to the National Conference of State Legislatures.