How Federal Law Effects Your Health Insurance

While creating this new website, I thought that a blog would be a wonderful opportunity for me to say some of the things that would not be helpful to say in the midst of one of my sessions with a patient. In the actual sessions, the patients’ thoughts, anxieties and concerns must and should be the focus. I also anticipated that this blog would be a great opportunity for me to learn from others about their experiences and reactions to the things that most psychoanalytic psychotherapists do not usually bring into the treatment sessions.

Given the above, I hadn’t expected to write about insurance or law or politics – especially not in my first post. Nevertheless, I feel deeply compelled to write a summary of the legal issues regarding our present health care delivery system (often referred to as Managed Care), and the law that contributed, and still contributes, to the present situation. I look forward to a dialog,  should one develop.

The McCarran–Ferguson Act 15 U.S.C. §§ 1011-1015

My patients are often confused by their insurance coverage and do not understand why their doctors, and therapists feel they can do very little to influence a decision made by the patient’s insurance company. Nor do they understand the reluctance, if not outright refusal, of many health-care “providers” to accept managed care insurance at all.

A good part of the population, myself very much included, believe that the Managed Care Insurance Companies are quickly and successfully becoming monopolies. And that as a result of their enormous control, the managed care insurance companies are able to set regulations that almost every physician and medical practitioner must follow if he or she wishes to work with a variety of patients and receive reasonable payment for their services.

I’ll provide just a few examples of what the insurance companies regulate. And I need to add that their regulations are more similar than not. The more expensive policies offer more benefits, and the less expensive ones offer less. But within their price range, the differences in benefits are almost non-existent and the companies appear to barely compete with one another.

• The kind(s) of treatment you’re permitted for a given diagnosis.
• What medications are available through the insurance company for your condition and the accompanying co-pay.
• Whether you are in need of psychotherapy or counseling. The Insurance Company’s assessment is based largely upon your behavior and ability to function in the outside world, without attention to how or what you feel inside.
• The total cost of any treatment(s) you receive (referred to as “usual and customary”).
• Their determination of full cost dictates the total amount your “provider” is permitted to receive for their services (from you and from your insurance company, combined).
• Your co-pay for each service and medication.
• The monthly cost of the insurance policy paid by you, your employer, or a combination.

At this point you might say “But how can they all do this? Don’t we have anti-trust laws?”

And This is What I Wanted to Tell You About

In 1945 Congress passed a bill called the McCarran-Ferguson Act 15 U.S.C. §§ 1011-1015, a United States federal law that exempts the business of insurance from most federal regulation, including federal anti-trust laws.

I believe this law, which has remained on the books unaltered for sixty-seven years, has allowed our health insurance companies to avoid competition and to provide policies that are eerily similar to one another. It has also provided them the opportunity to set the fees that doctors and other health care professionals are permitted to charge, thus preventing normal competition amongst “providers” as well.

In the last several years efforts have been made to amend, repeal or rewrite the law. Senator Robert Byrd presented a bill to Congress and Representative John Conyers has recently presented a bill. President Obama, during his first campaign for the Presidency also spoke about the bill and stated he would make efforts to repeal it.

So, the next time you may want to enter into psychotherapy, or get a test from your doctor, I hope you will remember the McCarran–Ferguson Act and its potential effect upon your efforts to take care of yourself in what you believe to be the best ways possible.

Madeline

Addendum 11/15/2012

Under the McCarran–Ferguson Act, the States regulate insurance. Since President Obama’s re-election, it appears that Obamacare will be implemented. Much is being written in legal circles about a potential legal conflict between the Federal implementation of Obamacare and the continued existence of the McCarran-Ferguson Act. Many legal scholars question whether the Federal Government has the legal right to set up Health Care Exchanges if the States, citing their regulatory rights under the McCarran-Ferguson Act, refuse to cooperate in creating such Exchanges. This could lead to many court battles which will slow the implementation of at least some parts of the Obamacare Plan.