Health Insurers Eliminate Child-Only Policies, Is it a Sign of Future Cutbacks?

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Will Health Insurance Firms Try to Circumvent New Law?

The tensions between the administration and health insurance companies reached a boiling point at the height of the health care debate. Even though both sides are dependent on each other to implement the new law, the recent debate over child-only policies signals that tensions don't seem to have abated six months after the law was signed.

White House Press Secretary Robert Gibbs on Tuesday called the insurance companies' decision on child-only, "unfortunate," and directly criticized AHIP.

"The insurance protection lobby, AHIP, had previously stated their willingness to abide by the law and not make the decision that we see several of these insurers made," Gibbs said. "Obviously, we're very disappointed at the decision they've made."

When asked to respond to Gibbs' comment labeling AHIP as an "insurance protection lobby," spokesman Zirkelbach said the industry is focused on new reforms, but he wouldn't touch on the press secretary's comments.

"The regulations have the potential to significantly increase the cost of coverage at a time when families are already struggling to maintain their health benefits," he said.

"Our industry is focued entirely on implementing new reforms in a way that's going to minimize disruption," Zirkelbach added. "There is a great amount of work to be done to implement all of the changes that need to be made. That's what our industry is focused on."

The tensions between the two sides are unlikely to abate anytime soon, experts say. In fact, more disagreements are expected to surface as bigger provisions roll out.

"You've seen some tensions already about insurance companies raising premiums and now there being some accountability about proposed increases in premiums," Pollack said. "Given that there are very significant practices being changed with the intention of protecting consumers, this (the debate over child-only plans) appears to be a symbol."

Insurance companies have already expressed concern about premiums for the Medicare Advantage program, a private sector alternative to the federal government's fee-for-service Medicare program.

Insurance companies are already saying that because of higher enrollment and cutbacks in payments, they will likely have to either increase premiums, reduce benefits or drop out of certain markets altogether.

Beginning today, insurance plans will be required to eliminate lifetime limits on insurance coverage, offer coverage for children with pre-existing condition, remove lifetime caps on coverage, provide free preventive care and allow young adults up to the age of 26 to remain on their parents' health plans, among other changes. Americans will see the changes when their insurance plans renew.

Insurance Resources:

The U.S. Government has created a comprehensive website, www.healthcare.gov, where users can access information about their specific care options.

Consumer Reports magazine has also produced a number of resources explaining the changes to health insurance under the new law.

Click here for Consumer Reports' guide on the basics.

Consumer Reports has also posted more in-depth information here: www.consumerreports.org/health/insurance/health-insurance.htm

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