Health Insurance Industry Weighs in on Baucuscare

The insurance industry has weighed in on Sen. Max Baucus’ health care reform proposal, and (not surprisingly) the reviews are pretty positive. In a 13-page letter to Baucus, Karen Ignagni, president of America’s Health Insurance Plans–the industry’s largest professional association–outlines “recommendations for strengthening” the bill and “concerns with key aspects of the proposal.”

So what does she like and what doesn’t she like? Well there’s a lot in there, but two fairly unsurprising objections stand out.First, the insurance industry doesn’t much care for Baucus’ plan to raise money by taxing and imposing fees on health care companies. Shocking, yes, but this is also Baucus’ main source of new revenue, and you can’t finance health care reform without new revenue.

Similarly, after successfully keeping the public option out of the proposal, Ignagni now says that the bill’s proposal to create a weak system of co-operateives (a system which the CBO said would be ineffective) will “only result in a slower march to a government-run plan.” In other words, any competition that has the tacit approval of the government is non grata.

At this point, it seems unlikely that either or these provisions will change too much as the bill moves forward. But it’s still something worth keeping an eye on .