IBJNews

Q&A: Jim Parker

Back to TopCommentsE-mailPrintBookmark and Share
Executive Q & A

Jim Parker was an executive at Anthem Blue Cross and Blue Shield and WellPoint, both of Indianapolis, for 14 years, including a year and a half as chief of staff to CEO Angela Braly. He now is president of his own consulting firm, Meridian Strategic Advisors, in Indianapolis. He spoke about the impact of the new health reform law on health insurers.

IBJ: You ran the Anthem insurance plan in Maine for several years. If you had had to adhere to the requirements in the new national health law—guaranteed coverage regardless of pre-existing conditions, pricing based on community instead of individual health status, a minimum level of benefits, and a requirement to spend at least 80 percent of premiums on medical claims—would you have been able to make money?

A: The short answer is: probably. In the Maine market, insurers were required to give guaranteed coverage to any applicant. We were also required to do modified community rating. You could adjust your rates for a limited number of factors (e.g., age, geography). The biggest difference between this law and the Maine market is that, in the Maine market, there was no requirement that you purchase coverage. So what happens is that people who aren’t sick or for those for whom the premiums are on the brink of affordability, just drop out of the pool. In the individual market, those premiums would increase 10 [percent] to 20 percent every year. All of our competitors who previously offered coverage to that market left that market. So it wasn’t a good outcome. The reform law’s requirement for individuals to have coverage would overcome this problem. But the enforcement mechanisms may not be high enough to be effective. If the mandate proves to be effective and helps people stay insured, there’s a chance we can avoid many of the problems we experienced in Maine. But that’s still an "if."

IBJ: Massachusetts is three years into a law similar to the one President Obama just signed. It has been successful at achieving near-universal coverage and is popular with citizens. Yet costs have continued to spike, leading to a showdown between health insurers and the governor. Do you think Massachusetts is a good bellwether for national reform? Why or why not?

A: It very well could be. This national health reform, at its core, is insurance market reform, which really doesn’t do much to fundamentally change the picture with respect to health care costs. So in Massachusetts they enacted health care reform, which was principally health insurance reform. But they didn’t do much of anything at all to make the cost of care more affordable. I think what we’re seeing in Massachusetts is really worth paying attention to, because this could be precursor of what we see in many states. There will be a very real political interest to trying to stand in the way of insurance premium increases that the insurance industry will argue are necessary and actuarially justified. So you’re going to have a showdown.
 
IBJ: Many people have said the new health law is a big step, but one that will require much more work to reform the many problems in our health system. In your mind, what's the biggest thing needing to be done beyond the changes in this new law?

A: The largest remaining issue facing health care is how do we get our arms around the absolute growth [in cost] that’s taking place. Perhaps the solution’s out there, but we haven’t found one that’s politically viable. For better or worse, health care generally is such a politically focused and politically driven topic, that it’s a market that’s very difficult to correct without political involvement.

ADVERTISEMENT

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. "bike lanes, specialized lighting, decorative signage, public art, grass medians, trees and rain gardens" These are all nice things to have, but can we freaking get the hundreds of potholes all over the city fixed first?!?!?!!?!?!

  2. When a criminal with multiple prior convictions serves five days of a one year sentence and later kills a police officer with a weapon illegally in his posession, residents of Boone County need to pay a tax to drive to work... PERFECT Progressive logic.. If, on the other hand, a fund were to be set up to build more prisons and hire more guards to keep the known criminals off the streets, I'd be the first to contribute.

  3. Not a word about how much the taxpayers will be ripped off on this deal. Crime spirals out of control and the the social problems that cause it go unheeded by an administration that does not give a rats behind about the welfare of our citizens. There is no money for police or plowing snow (remember last winter) or or or or, but spend on a sports complex, and the cash flows out of the taxpayers pockets. This city is SICK

  4. Sounds like a competitor just wanted to cause a problem. I would think as long as they are not "selling" the alcohol to the residents it is no different than if I serve wine to dinner guests. With all the violent crime happening I would think they should turn their attention to real criminals. Let these older residents enjoy what pleasures they can. Then again those boozed up residents may pose a danger to society.

  5. Where did the money go from the 2007 Income tax increase for public safety that the Mayor used to stir opposition and win the election and then failed to repeal (although he promised he would when he was running for election)? Where did the money go from the water utility sale? Where did the money go from the parking meter deal? Why does the money have all these funds for TIF deals and redevelopment of Mass avenue, and subsidy for luxury high rises, parking garages in Broad Ripple, and granola chain grocery stores but can not find the money to take care of public safety. Commuters shouldn't have to pay the tax of failed leadership in Marion County by leaders that commuters have no say in electing. Taxation without representation.

ADVERTISEMENT