Hillary Clinton expects health reform plan to squeeze out many insurers


WASHINGTON -- Hillary Rodham Clinton predicted yesterday that the president's health care reform plan would spark a "Darwinian struggle" in the insurance industry leading to the elimination of many companies.

In other comments about the emerging plan, Mrs. Clinton confirmed that mental health and substance abuse problems would be covered less generously than physical ailments in the benefits package she is designing as head of the White House task force on health care reform.

She also indicated that a final decision on dental coverage has not been made, although she expressed hope that both children and adults would be covered, perhaps to different degrees.

Mrs. Clinton's comments were relayed by participants in a closed-door session of consumer and health advocacy groups at George Washington University. The meeting was arranged by Families USA, a nonprofit organization pushing for health reform. Although the news media were barred, her comments were reported by some of the more than 300 people present.

Under the president's plan, which could be released as early as next month, all Americans would be entitled to a standardized health insurance package. Mrs. Clinton said the package would be comprehensive -- and that anything less is "not negotiable."

Precise details of the package have not been announced. Mrs. Clinton's goal is a plan at least as good as what most Americans with medical insurance already have, plus increased emphasis on preventive care.

Mrs. Clinton's statements about the insurance industry were a response to a representative of the Gray Panthers senior citizens organization who called for the elimination of insurance companies.

The president's plan would not eliminate the industry, but would likely winnow out many insurers. Companies that survive now by "cherry picking" -- insuring only healthy persons -- would be the first to go because reform legislation would prohibit that practice.

Smaller companies would generally face a difficult time because the president's plan calls for creation of large, consumer purchasing pools that would bargain with insurers for coverage. Some insurance experts predict this type of competition would eliminate all but the very big companies.

Mrs. Clinton said "only the best and fittest of them would survive," and did not elaborate. She expressed concern, however, about insurance company employees who would lose their jobs, a problem she described as one of the "social costs" of reform. She did not say if the Clinton administration would provide them any assistance.

Responding to her remarks, Health Insurance Association of America spokesman Richard Coorsh said insurers are "committed . . . to reform." He added, "Our concern is that we be able to compete and compete fairly on a level playing field. We're not at all unaware of the struggle for survival. Indeed, in a market economy that comes with the territory."

Mrs. Clinton's comments about limiting mental health coverage were not a major surprise because the administration is concerned about the cost of the benefits package that nTC employers, the government and individuals would pay for.

Mental health advocates, including Tipper Gore, the wife of the vice president, have been saying that mental health problems should be treated the same as physical problems in any insurance reform plan. Many current plans provide limited benefits, if they cover mental health at all.

The president has not yet made a decision on the degree and type of mental health coverage, a White House spokesman said yesterday. An official of the National Mental Health Association, Matt Russell, said, "My perception is there will be a comprehensive range of mental health services in the Clinton plan."

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