In the Pixar film, “The Incredibles,” a superhero who has gone into hiding is assigned the soulless task of processing insurance claims. In “The Truman Show,” the lead character is an insurance salesman who slowly discovers how sheltered his life truly is and finally breaks free. And the protagonist of “Fight Club” has a job that involves analyzing the risk of auto accidents for an insurance company, but soon he’s setting up fight clubs all across the country and launching a shadowy anti-capitalist organization.
In the real world, insurance is just the opposite. It's about as dull as it gets.
Perhaps the most contentious policy debate in the nation right now is over the appropriate level of government involvement in overseeing and subsidizing health insurance. For years, Republicans have assailed the Affordable Care Act – a landmark achievement of President Barack Obama’s administration – as an unmitigated disaster. Now that the GOP is in power, Democrats are attacking a proposed replacement plan that would save an estimated $337 billion but also result in an estimated 24 million people eventually losing coverage.
Locally, Uber and other ride-hailing companies have been in a battle with lawmakers to launch their services throughout New York because state insurance law doesn’t allow the services upstate. Despite launching in New York City in 2011, the state Senate and Assembly have failed to reach an agreement on authorizing state insurance legislation.
City & State spoke to three experts on the topic of insurance and how it affects legislation in New York. From the impact of repealing Obamacare to disagreements over insurance requirements and the expansion of ride-sharing, insurance is having its day.
Chairman, state Senate Insurance Committee
C&S: Outside of the ride-hailing push, what other insurance priorities will you push this session?
JS: I’ve been a long supporter, this has long been a priority in the Senate when it comes to insurance. We are interested in doing a comprehensive package of bills that reform auto insurance programs. Basically, coming down tougher on fraud and abuse of the no-fault system. I have a couple of bills here making it a crime to stage an accident and then collect – in a no-fault you can get up to $50,000 of benefits per individual. People stage accidents and run up the tab. There’s a runners bill that would make it a felony to be a runner. These are individuals that, following an accident, they procure alleged victims and then run them through these medical mills and once again to inappropriately collect no-fault benefits. (State) Sen. (Martin) Golden has a piece of legislation that has the retroactive cancellation, so that would allow the carrier to retroactively cancel a no-fault policy when that policy has been obtained fraudulently, either by writing a bad check or on an account that no longer exists or a stolen credit card.
C&S: What insurance issues will you be pursuing after seeing the governor’s budget and policy proposals?
JS: I’m interested in the fact that we want to keep insurance companies doing business in the state of New York to give our consumers plenty of choices when it comes to their insurance and a more competitive market and I think that makes insurance more affordable through a competitive market – plenty of choices and more affordable options for more consumers. The governor has some proposals that I think is detrimental to that. For example, he’s got proposals in the budget that would greatly expand the (state) Department of Financial Services’ ability to impose administrative supervision on companies … obviously we don’t want bad actors in the financial services industry and there are some situations where administrative supervision is needed, for the department to step in and, in effect, take over the supervision of a company in rare situations, but you have to have due process.
Chairman, Assembly Insurance Committee
C&S: Outside of upstate ride-hailing, what insurance issues will be taken up this year?
KC: We’re dealing with a variety of issues, including car sharing, which is actually sharing. It’s when you decide to rent your car out on an individual basis. We’ll be looking at that issue. We’ll be looking at the issue of liability insurance overall for automobiles and determining whether the limits are appropriate or even if the current form of coverage is appropriate. We will be examining a number of issues pertaining to health care. We can’t forget what they are because a lot of that is in the hands of Congress and what they decide to do with the Affordable Care Act. Of course, we will continue to take steps, as we have in years past, to ensure the role of insurance in our financial markets – which is the most prominent role that it has in New York – continues to be robust, safe and secure for the people of New York. We have an entire range of issues that we’ll be considering, large and small. In the budget alone, we’ll be dealing with medical malpractice insurance and a variety of other issues, so there’s a lot on the table just in insurance – and that’s only insurance.
"About one out of seven American people who enrolled under the Affordable Care Act have done so in New York state."
C&S: What happens if the Affordable Care Act is repealed?
KC: My biggest concern is that New York state enrolled a record number of people – about one out of seven American people who enrolled under the Affordable Care Act have done so in New York state. We’ve seen our Medicaid rules expanded through liberalization of eligibility requirements and we’ve seen a number of people secure insurance who never had it before. So, our No. 1 concern is whether Congress strips away those resources that made that possible. The comptroller has identified that there’s a potential loss to New York state of $3.7 billion should the Affordable Care Act be rolled back entirely.
We’re also dealing with things, such as contraceptive access under insurance plans. One that was virtually guaranteed under the Affordable Care Act, but now is threatened under the new Congress, so we’ll be dealing with those issues as well when it comes to the Affordable Care Act and insurance issues, so there’s a lot on our plate. We’re ready to move forward and it would be great if we could get this one issue about the transportation network companies behind us so we can renew our focus on those other ones.
Superintendent, state Department of Financial Services
C&S: What impact could the repeal of the Affordable Care Act have in New York?
MV: Repeal of the Affordable Care Act will impact millions of New Yorkers who will lose health insurance. And people losing health insurance means they will lose health care, and that comes from both the concern about the reduction in the funding for Medicaid and the expansion of Medicaid that the Affordable Care Act provided, it comes from the Essential Health Plan changes that would be impacted, and it comes from the changes in the private insurance market.
C&S: What impact could this have on premiums?
MV: Before the Affordable Care Act, our individual market (in the direct pay market) in New York was less than 20,000 people, and it was a high-risk group of people in that market that had premiums up to $1,500. Since the Affordable Care Act, beginning in 2014 when the policies started, the individual market grew to over 300,000 people and premiums dropped 50 percent from where they were before the Affordable Care Act in the individual market. So the talk about premium prices and everything else, I can’t speak for any other state but I can speak for New York under this governor’s leadership and with the advance of the Affordable Care Act, that it actually provided insurance coverage for hundreds of thousands of people in the individual market. Those are people who don’t have an employer that is providing them with coverage, and they need it. There are a lot of elderly in that market because maybe they had health care before and don’t qualify, and there are people who maybe had pre-existing conditions and couldn’t get health care previously and now were able to get it. And prices dropped, because the market expanded and the ACA had some great consumer protections. I feel strongly about what it did and we want to protect that.