While everyone else in the country is trying to figure out how to avoid Obamacare’s avalanche of mandates, taxes, and general red tape, one group is actually accelerating implementation. America’s health insurers are undertaking some of the law’s mandates well before they are required.
Over a week ago, UnitedHealth Group and WellPoint announced that they would be keeping overaged dependents (up to age 26) on their parents’ plans as early as June 1, even though the law doesn’t require it until the end of September.
Now both competitors have announced an end to the unpopular and politically poisonous practice of rescission (expect in cases of fraud). Not that this rush to satisfy their critics is doing them any good. The Minneapolis-St. Paul Star Tribune paraphrased the news as “we won’t drop sick members.” This is just another example of ill-informed, irresponsible, and hostile reporting.
“Rescission” does not mean “dropping sick people.” It means rescinding policies after learning that the insured party did not accurately disclose his/her health status when applying. An insurer cannot price premiums accurately without good knowledge of a person’s health status.
Furthermore, Obamacare’s restrictions on rescission are redundant, because federal and state laws have long prevented health insurers from rescinding policies wrongfully.
Perhaps UnitedHealth Group and WellPoint (which made a similar announcement only days after denying an unfounded attack by Secretary Sebelius on its rescissions) think that they can appease their enemies in the government and the media with these announcements of preemptive collaboration with those who wish to put them out of business. But I trust that their shareholders appreciate that the movement to repeal Obamacare and replace it with real reform is credible; and their executives’ efforts to curry favor with those whose goal is to eliminate them will soon be unnecessary.