Chapter[ Detailed Plan
Section[ Eliminate Insurance Discrimination, Improve Quality, and Rein-in Costs
Eliminate Insurance Discrimination, Improve Quality,
and Rein-in Costs
Equally important as providing choice is ensuring affordability and preventing insurance discrimination.
Insurance companies in America spend tens of billions of dollars per year figuring out how to avoid
costly beneficiaries. This contributes to our health system costing 50 percent more per person than
the next most expensive country. In a reformed system where all Americans are covered and risk is
spread extensively, administrative costs could be dramatically reduced. The American Health Choices
Plan addresses these barriers to quality, affordable care by:
1) Eliminating Insurance Discrimination: The plan creates rules that all insurers must follow,
ensuring that no American is denied coverage, refused renewal of an insurance policy,
unfairly priced out of the market, or charged excessive insurance premiums. Health plans
will compete on cost and quality rather than avoiding patients who need insurance the
most. The plan will:
• Require Guarantee Issue: Insurers must offer coverage to anyone who applies and
pays their premium. This protection, known as guarantee issue, will ensure that no one
is ever denied coverage because they are sick or an insurer fears they will be.
• Require Automatic Renewal: Insurers will be required to automatically renew policies
if the enrollee wishes to stay in the plan.
• Require Strong Rating Protections: Insurers would be prohibited from charging large
premium differences based on age, gender, or occupation (for example, a standard set
of modified community-rating protections).
• Require Minimum Stop-Loss Ratios: Premiums collected by insurers must be
dedicated to the provision of high-quality care, not excessive profits and marketing.
2) Improving Quality for All and Achieving at least $120 Billion Per Year in Savings
Nationwide: Responsible health reform requires modernizing our nation’s health system
to eliminate waste, promote prevention and guarantee quality. While the majority of such
savings flow to the employers, workers, and local governments, a substantial portion of the
savings will accrue to the federal government, and will be reinvested in the necessary
up-front investments to ensure affordable health coverage for all Americans. The plan will:
• Ensure That All Providers and Plans Use Privacy-Protected Information
Technology: The proposal will give doctors financial incentives to adopt health
information technology and facilitate adoption of a system where high quality care
and better patient outcomes can be rewarded. The RAND Corporation estimates net
savings from the use of information technology to be $77 billion per year.i Recently,
the Business Roundtable, SEIU, and AARP estimated that “widespread adoption [of
such IT reforms] raises the potential savings to $165 billion annually.” Hillary Clinton
has been a leader on this issue in the Senate and will get it done as President.
• Prioritize Prevention to Reduce the Incidence of Disease that Impose Huge
Human and Financial Burdens: Only half of recommended clinical preventive services
are provided to adults and less than half of adults had their doctors provide them advice
on weight, nutrition, or exercise.ii Only 38 percent of adults receive recommended
colorectal screening. Hypertension contributes to 35 percent of all heart disease and
dramatically increases the risk of stroke, yet only one in three people with this
condition know it, despite simple, proven screening tests. Along with guaranteeing
accessible insurance throughout the system, the American Health Choices Plan
requires coverage of preventive services that experts agree are proven and effective.
• Improve Care of the Chronically Ill: Americans with multiple chronic diseases –
including heart disease and diabetes – account for 75 percent of our total national
health expenditures and are the leading causes of death in the U.S.iii The American
Health Choices Plan will promote chronic care management programs as well as
innovative models such as “medical homes.”
• Fund and Distribute Independent Research to Compare Effectiveness of
Treatments: In the past decade, there has been an 80 percent growth in the number
of drugs prescribed, 100 percent growth in new medical device patents, 300 percent
growth in teaching hospital procedures, and 1,500 percent growth in diseases with
gene tests.iv Patients, providers and payers need information on how treatments
compare to one another. The American Health Choices Plan funds a Best Practices
Institute that would work as a partnership between the existing Agency for Healthcare
Research and Quality and the private sector to fund research on what treatments work
best and to help disseminate this information to patients and doctors to increase
quality and reduce costs.
i. R. Hillestad et al. (2005). “Can Electronic Medical Record Systems Transform Health Care? Potential Health Benefits,” Health Affairs. 24: 1103-1117.
ii. E. McGlynn, et al. (June 26, 2003). “The Quality of Health Care Delivered to Adults in the United States,” New England Journal of Medicine, vol. 348, no. 26.
iii. A.H. Mokdad, J.S. Marks, D.F. Stroup, J.L. Gerberding. (2004). “Actual Causes of Death in the United States, 2000,” JAMA 291(10): 1238-45.
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