NU Online News Service, Oct. 16, 2009, 4:05 p.m.EST

Officials of America's Health Insurance Plan are apparentlyextending an olive branch to Senate Democratic leaders in an effortto re-open talks aimed at reshaping the health care reformlegislation passed by a Senate panel earlier this week.

At the same time, AHIP released a new study which it says is"consistent" with a controversial study released Sunday, which itcommissioned. The new study said the current versions of healthcare reform legislation will raise the cost of health careinsurance for most American families. The study does not, however,include the impact of medical inflation.

The earlier study, by PricewaterhouseCoopers, said the versionof health care reform legislation reported out by the SenateFinance Committee on Tuesday would raise the cost of health careinsurance for some Americans by an additional 14 percent over thenext five years compared to the current system.

That study was condemned by the White House and Democrats inboth the House and Senate.

For example, the White House said in a blog, "This is aself-serving analysis from the insurance industry, one of the majoropponents of health insurance reform."

The statement noted, "Even the company hired to produce thereport has issued a statement saying they produced a skewed reportthat analyzes only part of the bill because that is what theinsurance industry paid them to do."

The latest report by Oliver Wyman Associates was releasedThursday by AHIP. It said current proposals will increase the costof health care coverage for families and small businesses abovewhat they would be under current law.

The Oliver Wyman study also projects a 19 percent increase inindividual market premiums, with AHIP noting that the PwC studyfound a 28 percent increase, although AHIP said the PwC reportanalyzed additional factors not considered in the Oliver Wymanreport.

But in the letter to the Senate Democratic leadership, KarenIgnagni, president and CEO of AHIP, said she was seeking to"reaffirm our commitment to working with you to achieve theenactment of bipartisan reform legislation this year."

The letter was sent to Sen. Harry Reid, D-Nev., Senate majorityleader; Sen. Max Baucus, D-Mont., chairman of the Senate FinanceCommittee; and Sen. Tom Harkin, D-Iowa, chairman of the SenateHealth, Education, Labor and Pension Committee.

Ms. Ignagni made her comments against the background of effortsby the Senate Democratic leadership to meld the Senate Financemeasure, passed by the panel Tuesday, with legislation passed inJuly by the HELP Committee.

The combined bill will then be sent to the Senate floor fordebate, hopefully by the end of next week.

The objective of such legislation, she said, "is to cover allAmericans, improve quality, and put the health care system on anaffordable basis."

Ms. Ignagni also said in the letter: "Our community recognizesthat we have a responsibility to play a leadership role inidentifying strategies that will allow Congress to pass health carereform legislation that will work and that can be sustained."

The study recognizes that those drafting health care reformlegislation face the politically difficult problem of mandatingpenalties for not getting health insurance, because having as manypeople pay for health insurance as possible is one key to reducinghealth insurance premiums.

The letter offers alternatives to the current decision by billdrafters by significantly reducing proposed penalties for notgetting health insurance in order to ensure public support.

The letter suggests alternatives to the current mild penaltiesfor not having coverage, such as the late enrollment penaltiessimilar to those currently under the Medicare Part B and Part Dprograms, coupled with the loss of tax benefits–such as the removalof the personal tax exemption–for those who do not comply with thepersonal coverage requirement.
These may "offer a fresh approach," Ms. Ignagni said.

"By pursuing a package of strategies to boost enrollment duringthe transition, we can ensure that premiums are lower and build astable and sustainable system with lower costs over the long-termbudget window," she said.