Obamacare Insurance Exchanges Are Corporatism Disguised as “Competition”

by Whitney Pitcher

Earlier this week, I noted how Cook County board president and Obama mentor Toni Preckwinkle secured a $100 million Obamacare waiver to implement Medicaid expansion in the county a year early and cover a gap in the county budget. The conflicts of interest in Obamacare adds yet another layer as insurance exchanges are in the process of being implemented before the 2014 deadline. The Hill Healtwatch reports:

The fast-approaching deadline gives the administration little time to scrutinize private-sector partners for conflicts of interest.

The purchase of one of these contractors, Quality Software Services, Inc. (QSSI), by UnitedHealth Group, a major healthcare conglomerate, has sparked concerns about a potentially uneven playing field.

QSSI, a Maryland-based contractor, in January won a large contract to build a federal data services hub to help run the complex federal health insurance exchange.

It will be working with several other contractors, including CGI Federal, Inc., to create the technological architecture for the exchange.

The quiet nature of the transaction, which was not disclosed to the Securities and Exchange Commission (SEC), has fueled suspicion among industry insiders that UnitedHealth Group may be gaining an advantage for its subsidiary, UnitedHealthcare.

The article aptly compares these health insurance exchanges to websites like Travelocity or Expedia where consumers can pick and choose the best deals for airline tickets or hotels. With the potential conflict of interest in the health care exchange, it would be akin to Travelocity or Expedia owning American Airlines or Marriot Hotels and thus potentially driving consumers to purchase their product based upon how that company portrays the available options.  As the article goes on to note:

If an insurance company had influence over the information technology architecture used to run the exchange, it could interpret federal standards in a way to exclude competitors or make it more difficult for them to win approval, say some insurance experts. Or it could have an inside track on knowing how to design plans that meet the standards.

The contractors working on the exchange will also have responsibility over payment calculation for risk adjustment.

This program is intended to redistribute funding from plans that attract younger and healthier participants, and thus have lower costs, to plans that attract people with more chronic diseases.

The draft statement of work for the contract shows QSSI will also work on technical requirements to deliver financial management services, such as payment calculation for risk adjustment.

The prospect that a subsidiary of UnitedHealth Group could have a role in calculating the reallocation of federal funds among rival health plans has unnerved some industry insiders.

In mid October, Senator Orrin Hatch sent a letter to DHHS Secretary Kathleen Sebelius asking for a full accounting of who received federal Obamacare contracts and what government officials signed off on those contracts. Sebelius has not responded. Hatch has also asked if Steve Larsen, a former official at HHS played a role in this contract:

Larsen left the Center for Consumer Information and Insurance Oversight, the office tasked with crafting rules for the national exchange, in July to take a job with Optum. It is not clear how long Optum was in consultation with QSSI prior to purchasing it.

Shields Britt, the spokeswoman for HHS, said Larsen would have to comply with stringent rules.

“Former HHS employees are subject to the strict ethics policies put in place at the start of this administration, which are some of the toughest ethics rules ever imposed on executive branch appointees, and those standards certainly apply here,” she said.

Optum, whom Larsen currently works for, is the subsidiary of UnitedHealth Group that bought QSSI, the company who would provide the information infrastructure for the exchanges.How’s that for a revolving door between government and industry? What are those strict “ethical” standards? Those words ring hollow from an administration whose first choice for HHS Secretary, Tom Daschle, was a “policy adviser” (newspeak for lobbyist) at the firm that lobbied for United Health.

The rhetoric behind the Obamacare insurance exchanges is one of competition and consumer choice, but the truth behind it is nothing more than continued corporatism and conflicts of interest.

2 Comments

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2 responses to “Obamacare Insurance Exchanges Are Corporatism Disguised as “Competition”

  1. I Love You All Anyway

    sarahnettoo blocked me for no legit reason I am aware of so this is my sign~ I am now officially done speaking the truth~ And what I have found is that most can not handle it~ Amen Anthony Chad AKA The Light
    Luke 4:20 Then he(Christ) rolled up the scroll, gave it back to the attendant and sat down. The eyes of everyone in the synagogue were fastened on him, 4:21 And he began to say unto them, This day is his scripture fulfilled in your ears.
    Luke 4:28 And all they in th synagogue, whn they heard these things, were filled with wrath, 29 And rose up; thrust him out of the city, and led him unto the brow of the hill on which their city was built, that they might cast HM down headlong.
    They all thought He was a fake and a nut~ And it is odd how it took 2000 years of reading to even close to really believing but with Him standing in front of everyone this day they would still think the same things about Him~ God Almighty how I weep for Christ~ And I know exactly, to a tee what He felt like~
    My father never told me he loved me until he was dying and although he beat; neglected me from childhood I always forgave him~ That is right I love you all while you think negative of me~ Some of his last words to me were ” I never showed you I loved you but I always felt you begging for mine~” 41 years of this rejection and I am stronger and walk more than I talk~! God Bless You All~ And no matter how blind people may be they still walk with me~ Believe what you want because the love and empathy I carry gives choice and always will~ I want be rejecting you all it will always be the other way around~ Proved by sarahnettoo and many others~ Peace~!!!!!!!!!!!

    • Gary P Jackson

      You’ll have to take that up with sarahnetoo. They do a wonderful job of getting us video we’d never have time or the resources to get on our own. We have a great relationship with each other, but they set their standards, just as we set ours, for commenting.

      I rarely block people, though some, with excessive foul language or over the top hate thrown at the Palin’s or other Conservatives usually get sent straight to the trash. No need to give those clowns the satisfaction of seeing it print.

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