New Survey’s Support For Suing Health Plans Is Suspect


October 28, 1999

CONTACT: Richard Coorsh

(202) 824-1787

The following statement was released today by Donald A. Young, M.D., Chief Operating Officer and Medical Director with the Health Insurance Association of America (HIAA):

A new survey of employer-sponsored health coverage – released today by the Kaiser Family Foundation and the Health Research and Educational Trust – finds that 3 out of 5 employers favor allowing patients to sue their health plan. We believe that this finding is suspect in the extreme for three reasons. First, every major business trade association indicates that expanding liability against health plans would cause employers either to reduce benefits, or drop coverage altogether.

Second, representatives from the Kaiser Family Foundation admit that the survey released today did not ask whether employers would drop coverage if faced with increased premiums due to expanded liability. They also indicate that previous surveys that they have released show a decline in support for expanded liability when employers are confronted by the prospect of paying higher coverage costs. Third, the survey was conducted earlier this year, when relatively few employers were likely to know that Congressional proposals to expand liability also would expose employers to lawsuits.

On another front, the extent of coverage documented by today’s survey offers compelling testimony to the wisdom of retaining and improving the employer-based health coverage system to increase the number of insured Americans. The survey indicates that the percentage of employers in 1999 that provided health coverage for employees, and their dependents, is roughly the same as it was in 1998. We interpret this finding to show that overall, employers have been willing and able to continue to provide health coverage, in spite of higher costs due to medical care cost inflation, and cost increases resulting from additional government mandates.

The employer-based health coverage system provides excellent value to consumers because it has produced high quality, affordable coverage for 152 million Americans. Nevertheless, there remain a significant number of employers – primarily smaller businesses – that operate on margin, and that cannot afford the cost of coverage. HIAA’s "InsureUSA" proposal recognizes their plight, and calls for tax enhancements to expand coverage. Additionally, "InsureUSA" would bring about reforms to enable the roughly 3 out of 5 uninsured Americans who are poor – or who work for businesses that do not provide coverage – either to better afford private coverage, or to obtain public coverage.



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