It’s clear that any final version of health reform will be controlled by private, largely for-profit insurance companies. Their aim, once you strip out the P.R., is to make more money, not to give you better care. To keep fighting back, we need the help of insiders–the people who know the secrets of the health insurance industry. Former corporate adviser Richard Eskow has a Huffington Post piece today that’s an eye-opener on the "give them less and make them think it’s more" tactics used by both employers and health insurers.

What Eskow says is a perfect fit with the revelations of Wendell Potter, a former Cigna exec who exposed delay and denial of care as a chief profit driver of the health insurance industry. By understanding how it’s done, consumer advocates can push back.

Eskow’s piece today explained a recent amendment to the Senate bill that puzzled me: technical language describing how insurers would measure what they are spending on actual health care, as opposed to administration and profit. Under reform, insurers would be required to spend 80% or 85% of your insurance premium dollars on actual health care. But all the loopholes are in the definitions, says Eskow:

If you don’t know how insurance companies can work around regulatory
obstacles, you have no idea how fragile or even counterproductive some
ideas can be. Take the Senate proposal to hold insurance company
profits to 15 cents on every dollar collected. It sounds great, but as
I told David Dayen of Firedoglake , it wasn’t hard to come up with five ways the insurance companies could get around it.

As David writes,
those ideas included tinkering with the "incurred but not reported"
cost reporting system the industry uses, and re-labeling some
administrative costs as "medical" in nature (which is already being
done by some workers’ compensation insurers). Nationwide companies
could move more of their corporate expense load (including executive
pay) to divisions and regions of the country that are already ahead of
the Senate’s target (like these Florida HMOs). An even simpler approach would be to simply pay more in medical costs than they are paying today.

An even bigger loophole will be the definition of what constitutes an "essential benefit," which every new insurance policy must cover. In the legislation it’s just a list, like "maternity benefits" and "physician visits" and "preventive care." There’s a lot of room for definition. Will maternity care include any hospital stay after delivery (as California requires)? Or will new mothers and babies get kicked out before bedtime? It all may depend on how much power the states retain to enforce patient rights and require more complete benefits.

The insiders’ grasp of the secretive business end of health care gives us a better grip on the fine print in today’s legislation, and their advice for many tomorrows will help consumers keep pushing for better reforms. Thanks, guys.