Who said journalistic integrity was dead?
Apparently individuals who woke up this morning to read a quarter-page story published in newspapers throughout the country with the headlines "Competition lacking among private health insurers". The AP story written by Ricard Alonso-Zaldivar is a prime example of a so-called unbiased major media organization that has once again failed to actually check the factual accuracy of a story centered upon the health care debate. The story, based upon a report published by the left-wing Urban Institute Public Policy Center cites that health care reform would lower individual health care costs by more than $200 billion by offering a public option that would compete in the private market. The report and article, including a nice graphic provided to print media, cites the lack of competition among private insurers due to the dominance of Blue Cross Blue Shield throughout the United States with a nearly 47% market share throughout the country. (by the way the graphic provided by the AP highlights BCBS market share in individual states, with only the highest percentages shown in a handful of states)
In addition to the attacks upon the Blue Cross Blue Shield Association, the article specifically points to hand-picked states such as Maine whereas competition is far less than surrounding States. The article offers no fact-checking and freely quotes the left-wing Urban Institutes rhetoric with little more than a paragraph of rebuttal.
So let's take a look at the facts behind the story...
#1) The Urban Institute is an openly liberal organization that is providing data that they have researched and manipulated to fit their political agenda. There is nothing wrong with reporting those figures, so long as research from non-partisan entities such as the CBO are provided when those facts and figures dispel these so called lower costs.
#2) More than 1,300 Health Insurance Carriers operate nationwide and Blue Cross, Blue Shield companies are among those. However, Blue Cross Blue Shield is an association, not a single company. Blue Cross Blue Shield was established to provide consumers a continuity of coverage and network of coverage nationwide. It is an association of privately held insurance companies, and is comprised of separately owned Blue Cross or Blue Shield companies. For instance Blue Cross Blue Shield of Illinois (officially Health Care Services Corporation) is a separate company from Blue Cross Blue Shield of Iowa or Indiana. These are separate companies, that operate in accordance with portability and network sharing guidelines agreed upon by the BCBS association. Yet, each individually owned BCBS company offer different designed plans, based upon the needs of their individual markets and competition within those separate markets. To a single private corporation, such as Aetna, controlled such a market share the report would make a valid point. But a single corporation does not, and as such the AP and every newspaper carrying this story has an obligation to check their facts before repeating such propaganda.
#3) The story points out Maine as an example of lack of competition, choosing a less populated state in which competition is regulated through a state insurance department. Just as in all 50 states, insurance regulators must approve individual companies and plans before they can be sold. As a result the market is far from free, competition is controlled by those states and a large market share by a single company is most likely the result of sound business practices, not an attempt to corner the market.
#4) A majority of health coverage in the nation is provided through employer-sponsored plans and every single company in this nation has a human resources department that is constantly working to lower health insurance costs for the company and for the employees. A vast majority of companies will not agree to a plan until they receive multiple quotes from multiple companies.
#5) The article infers through quoting the author of the report that "there is no incentive for insurers or big hospitals to negotiate with each other, because they can pass higher payments pm through premiums." Really? The AP offered no rebuttal to the statement and as a result has created and perception that greedy insurance companies are in bed with greedy physicians. The reality is that no insurance company can grow market share without offering the lowest premium possible for the coverage desired. As a result, negotiations between hospitals and insurance companies are lengthy and intensive. If the two parties were only interested in "passing higher payments on through premiums", then why do physician networks and hospital networks change? If the two parties were in bed together to rip off Americans, then we would not even have preferred provider networks.
#6) Private insurer premiums are the only funding that Hospitals are receiving that are keeping them solvent. When physicians are paid an average of 23% less for care provided under Medicare or Medicaid and then must wait years in many cases to receive reimbursement, naturally, they are left relying upon the timely payment from private insurers to keep the doors open.
Finally, the only good thing to come out of this article is a single statement by Dr. James Rohack, the president of the American Medical Association. "When you've got the federal government involved, it can infuse money into a plan to keep it solvent even if the premiums are lower than its actual costs." This single statement sums up the essence of the health care debate and the reality of hopeful and misleading propaganda coming from the media and the White House. Unfortunately, most local edition newspapers conveniently cut off the end of the article.
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