Thursday, Jul. 30, 2009

The Insurance Companies

Private insurers are making healthy profits now but know they will lose a sizable chunk of customers when baby boomers move into the Medicare system. Insurers make money by setting rates based on the health of enrollees and turning down individuals with expensive pre-existing conditions.

What They Like: Current reform proposals could require all Americans to get health coverage, giving insurers a huge pool of potential new customers.

What They Don't Like:
Any government-run health plan could lure Americans away from private insurance. Plus, new regulations could prohibit insurers from rejecting anyone for coverage or basing rates on health risk. To generate revenues and discourage overuse of health care, insurers could be taxed on some high-end employer-based health plans.