Aiming high on Health insurance rate

President Barack Obama is trying to revive his stalled national health care overhaul by taking the fight to the private insurance companies.

The Obama administration will propose legislation that would allow the government to block excessive rate hikes by health insurance companies, a senior administration official said.

The official could not speak on the record because the White House has not formally announced the proposal.

The proposal would give the federal Health and Human Services Department–in conjunction with state authorities–the power to deny egregious premium increases, roll them back, or demand rebates for consumers, said a White House official, speaking Sunday on condition of anonymity because details have not yet been officially released.

Word of the administration plan comes as the White House was to unveil President Obama’s latest health insurance reform proposal at 10 a.m. ET Monday.

The United States is the only developed nation that does not have a comprehensive national health care plan for all its citizens. Many people rely on private insurance plans.

The House of Representatives and Senate have passed their own versions of health care reform. The new Obama plan is expected to attempt to smooth the differences.

Obama will propose changes that include eliminating the so-called “Nebraska deal,” a provision worked in by Sen. Ben Nelson, a Nebraska Democrat, that exempts that state from paying increased Medicaid expenses, the official said.

Recent insurance premium hikes of as much as 39 per cent sought by Anthem Blue Cross in California have given Mr. Obama a new argument for his sweeping health care reforms, now stalled in Congress.

The president also plans to include a series of measures proposed by Republicans to eliminate waste, fraud and abuse.

His proposal also introduces a new provision to prevent arbitrary insurance rate hikes such as a recent 39 percent increase in California.

That provision incorporates legislation last week introduced by Sen. Dianne Feinstein, D-California, to protect people from such hikes–a measure that came after the premium increase by Anthem Blue Cross of California, two senior administration officials said.

The proposal also would give the secretary of health and human services new authority to stop private health insurance companies from increasing their premiums, calling on the secretary to work with state regulators to review rate increases and deem them justified or unjustified, according to the officials.

In addition, the proposal would create a Health Insurance Rate Authority–a group of health care experts who would issue an annual report with their assessment on what they would consider reasonable premium increases.

Under the Mr. Obama plan, regulators would create a competitive marketplace for small businesses and people buying their own coverage. The plan would be paid for with a mix of Medicare cuts and tax increases. It would also strip out special Medicaid deals for certain states, while moving to close the Medicare prescription coverage gap and making newly available coverage for working families more affordable.

About 50 million of America’s 300 million people are without health insurance. The government provides Medicaid and Medicare coverage for the poor and elderly, but most Americans rely on private insurance, usually received through their employers. However, not all employers provide insurance and not everyone can afford to buy it on their own. With unemployment rising, many Americans are losing their health insurance when they lose their jobs.