VP Biden Offers State Insurance Regulators Ground Rules for Healthcare

Vice President Joe Biden told state insurance regulators this week that “soaring” health care premiums are hurting families and businesses, which he said underscores the need for a healthcare overhaul.

“Health insurance premiums in states have gone up between 90 and 150 percent in the last decade, far faster than wages and inflation,” Biden told the National Association of Insurance Commissioners conference outside of Washington.

Calling the national dialogue a “legitimate debate,” Biden maintained that proposed reforms would preserve and create more competition while providing more choices for consumers.

Reform would mean 30 million to 40 million new paying customers, many of them healthy and young, which would keep costs down, he said.

He presented a set of what he termed “good ground rules” that he believes health insurance companies should adopt to restore stability. “If every company has to have some guarantees, no company is at a competitive disadvantage,” he said. These rules include:

• No Discrimination for Pre-Existing Conditions;
• No Exorbitant Out-of-Pocket Expenses, Deductibles or Co-Pays;
• No Cost-Sharing for Preventive Care;
• No Dropping of Coverage for Seriously Ill;
• No Gender Discrimination;
• No Annual or Lifetime Caps on Coverage;
• Extended Coverage for Young Adults;
• Guaranteed Insurance Renewal.

Biden said that insurance companies should make a profit, but that they also must be held accountable.

“This is not going to spell the end of private insurance,” he said.

Biden said if everyone is expected to have health insurance, companies will gain “tens of millions” of new customers.

If there’s not a fundamental change to the system, healthcare costs will overwhelm Americans and the federal budget, he said.

“If we do nothing in 10 years, one in every five dollars Americans earn will be spent on healthcare,” Biden said. “Spending by the federal government on Medicaid and Medicare alone will be 15 percent of GDP by 2040.”

Biden told the state regulators that they play an important role in the debate and the future of health insurance.

“Your input in the process will be key to the success of health care reform,” he said. “You support reform. You know better about the inefficiencies, cost shifting and bad practices. You’re the best equipped to educate consumers and a critical line of defense against fraud. You are the most influential to deal with this issue in our states.”

Officials with the association said members of Congress have consulted them along the way and that the Senate Finance Committee bill keeps a place for state regulation.

Biden said despite the heated debate, he’s convinced there’s broad agreement.

“I know this has been a loud and contentious debate, just look at some of the town meetings,” Biden said. “But the truth is we have never been this close to real reform — ever.”

The Associated Press contributed to this report.