How will reform impact Payors?

I have developed quite a fondness for children’s books, particularly those with a well disguised allegory.  Long favorites of mine include the short stories, Uncle Remus, written by Joel Chandler Harris.  Br’er Rabbit (“Brother Rabbit”) is the main character in each of the stories, a likable troublemaker and prone to tricks.

His opposition is usually Br’er Fox Br’er Bear. In one tale, Br’er Fox and Br’er Bear hope to capture Br’er Rabbit.  Fox constructs a lump of tar and puts clothing on it. When Br’er Rabbit comes along he addresses the “tar baby” amiably, but receives no response.  Br’er Rabbit becomes offended by what he perceives as Tar Baby’s lack of manners, punches it, and becomes stuck. Now that Br’er Rabbit is stuck, Fox and Bear ponder how to dispose of Br’er Rabbit.

With each idea suggested for his demise, Rabbit has no complaints, however the helpless, but cunning, Br’er Rabbit always pleads, “Do with me what you will, but please don’t throw me in to that briar patch.”  Finally catching on to how “frightened” Br’er Rabbit is if the briar patch, Fox, believing he has the upper hand, throws Rabbit into the briars.  As rabbits are at home in thickets, the resourceful Br’er Rabbit convinces his enemies to do what he wanted them to do all along.

Sound familiar?  It should.  Br’er President and Br’er Congress.  The contest is how do they capture Br’er Payor and get Payor to play nicely.

“Let’s put caps on Br’er Payor’s rates,” suggested Br’er Congress.

“Do with me what you will,” pleads Br’er Payor.  “Cap my rates, but please don’t make us cover the uninsured.”

“Why not make Payor cover pre-existing conditions?”  Asked Br’er President.

“Do that,” chided Br’er Payor.  “We’ll even cover hangnails.  But please don’t make us cover the uninsured.”

“You know Br’er President,” said Br’er Congress, “Br’er Payor seems awfully afraid that we will make them cover all of the uninsured.   Let’s do that, let’s hit Payor where it will hurt the most.”

And so they did—made Br’er Payor cover the uninsured—threw them right into the briar patch.  Right where Br’er Payor wanted to be all along.  Thirty-one million new customers—how awful.  Smack dab in the middle of a recession, payor is handed a windfall of new customers.  Premiums.  Times twelve—twelve months.  Let’s estimate a hundred dollars a month.  That’s about thirty-seven billion in new revenues.  Billion with a B.  How is that for cutting healthcare costs.

Now suppose, just suppose that Br’er Payor has little motivation to be a good corporate citizen.  I know I am asking you to take a leap of faith.  Silly me, but I have this question that is gnawing at my craw.  What if Br’er Payor collected all these premiums and set the deductible so high that none of their new customers was ever able to file a claim?  The feds tossed the payors right into the briar patch, didn’t they?

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