Selling Across State Lines – The Moral Healthcare Blog

Selling Health Insurance Across State Lines

Selling Health Insurance Across State Lines:
An Assessment of State Laws and Implications for Improving Choice and Affordability of Coverage
By Sabrina Corlette, Christine Monahan, Katie Keith and Kevin Lucia

“Across state lines legislation was largely
unsuccessful because of the localized nature of how
health care is delivered. Respondents universally
reported the enormous difficulty that out-of-state
insurers face in building a network of local providers,
and insurers identified doing so as a significant barrier
to market entry that far surpasses concerns about a
state’s regulatory environment or benefit mandates.
State officials and insurers also noted that across
state lines legislation ignores the primary cause of
high prices—the cost of delivering care—and fails to
account for often dramatic differences in the cost of
care between states and regions.”

Followed Wendell Potter’s link from http://www.huffingtonpost.com/wendell-potter/romneys-phony-answers-to_b_1948449.html
TO the full pdf file:
http://chis.georgetown.edu/pdfs/Selling%20Health%20Insurance%20-%20fnl.pdf

Wendell Potter: Romney’s Phony Answers to Tough Health Care Questions

High on the list of recommendations in Romney’s health care platform is an idea frequently touted as a silver bullet by conservatives: allow insurance companies to sell policies across state lines. Doing so, they say, will increase competition and, consequently, bring down the cost of coverage.

The problem is that no one had done a study to determine definitively whether the across-state-lines idea would work — until now. And the conclusion of that study, conducted by the Georgetown University Health Policy Institute, is that allowing coverage to be purchased across state lines is much more of a blank than a bullet.

The study also finds that no new federal law is even needed to allow insurance companies to sell policies across state lines.

“With or without changes to federal law, states already have full authority to decide whether or not to allow sales across state lines and, if so, under what circumstances,” the study noted.

Of course, you wouldn’t know that from listening to Romney and other politicians who seem to believe than an act of Congress is needed. It isn’t. State legislatures can make it happen whenever they want, but, so far, only six have decided to try it. Georgia, Maine and Wyoming have enacted legislation in recent years to allow out-of-state insurers to sell policies within their borders. Lawmakers in Kentucky, Rhode Island and Washington passed bills requiring their insurance departments to research the idea and determine interest from out-of-state insurers.

The lawmakers who championed the legislation expected their states would be inundated with applications from insurers far and wide eager to sell their policies. But it hasn’t happened. In fact, not a single insurance company has expressed the slightest interest in doing business in any of those six states.

The Debate Over Selling Insurance Across State Lines

Kaiser Health News Today’s Headlines:

An article giving a brief overview of the issue. My favorite line, from John Shadegg is here:

“Why are Republicans critical of how Democrats handle the issue?

They say its redundant for states to have to pass laws to allow their residents to buy coverage from other states. And they don’t like the idea of having the federal government set minimum standards. ‘In reality, (their) bill nationalizes federal insurance regulation and gives the average American family no relief from expensive mandates that drive up the cost of health insurance,’ said Rep. John Shadegg, R-Ariz. said.”

Expensive mandates like, covering stuff.

But, according to CBO estimates quoted at the end, even the states with the laxest regulations would only generate a 5% reduction in premium costs.

Until, of course, the industry picks a state, buys the insurance regulating apparatus and the state’s legislature, and develop the classic “never pay policy.”