Health Care Activists Battle Powerful Insurance Companies

Posted by dday, Hullabaloo at 5:02 PM on May 20, 2009.

[Editor's note: For more on how you can fight for health care reform, click here.]

The biggest difference between 1993 and 2009 when it comes to health care is the coordinated message machine - on the left this time - pushing for reform. Under Clinton, the White House horded the policy and nobody could go out and sell it, or at least rebut the attacks from industry. This time, the Health Care for America Now structure allows activists a place both to attack back at industry and keep them occupied, while arguing for a consistent set of principles that must be part of any reform. Today, HCAN did something great, calling on the Justice Department to look at monopolies in the insurance market.

Activists backing President Barack Obama's health care overhaul are asking the Justice Department to open a wide-ranging investigation of what they say is monopoly-like power in the hands of major insurers [...]

"A lack of antitrust enforcement has enabled insurers to acquire dominant positions in almost every metropolitan market," said the letter to the Justice Department, signed by Richard Kirsch, the group's director. "The failure to attack anticompetitive practices has enhanced the dominant positions of these insurers. This must be reversed." [...]

In a report earlier this year, the American Medical Association found that insurance markets in most major metropolitan areas were dominated by two companies, and in many cases only one. In all, 94 percent of the metropolitan areas met the government's definition of "highly concentrated" markets for health insurance.

Separately, a recent report by the congressional Government Accountability Office found that in most states, a single insurer dominates the market for small business health insurance, even though many companies offer coverage. The GAO found that the median, or midpoint, statewide market share of the largest insurer was about 47 percent, although the median number of licensed carriers was 27.

This is all the more important, considering that the health insurance industry's "compromise" solution for reform is to EXPAND THEIR MONOPOLY by mandating that everyone in America buy health insurance from them, without the opportunity for a public plan alternative. With nobody to compete with and essentially a forced market, insurers would have every incentive to consolidate further, the very action which has driven up health care premium costs over the years, as an HCAN report later today will show. While insurers aren't the only cause of rising health care costs - pharmaceuticals, medical device operators, hospitals, there's plenty of blame to go around - this model of activism can be scaled to pressure both the industry and the political class.

Health care reform will rise or fall this year based on the success of these activist efforts, toward both the special interests and the politicians. Doesn't mean it'll succeed, but it gives it a fighting chance. Frank Luntz (who won't say who paid him for the health care memo) isn't the only game in town anymore.

Tagged as: obama, health care, health care reform, hcan, blue cross blue shield