Now that rescission is being outlawed (if the bill passes) the only way left for insurers to maximize the difference between what they take in in premiums and pay out in coverage is to deny coverage. What effect does the proposed bill have on an insured's ability to force private insurance companies to provide the paid for coverage under state laws? Has anyone analyzed these draft bills from a consumer protection perspective & federal pre-emption?
Now that rescission is being outlawed (assuming a bill passes) the only way left for insurers to maximize the difference between what they take in in premiums and pay out in coverage is to deny coverage. These managment of these corporations have a fiduciary duty to maximze return to shareholders. Customers not infrequently have to fight to obtain coverage under various state laws like little FTC Acts (consumer fraud/deceptive trade practices). What effect does the proposed bill have on an insured's ability to force coverage under state laws? Does the law provide insurance companies with new pre-emption arguments? I'd be interested to hear from anyone who has anlayzed the proposed legislation from a consumer protection & federal pre-emption perspective. Any limitations on damages for insurance companies?
Using new, and typically meaningless or profit enhancing, federal regulation as a means of pre-empting costly lawsuits brought under state law has been a recent trend of our corporate masters. They employ the federal government, whose regulation & big government they constantly rail against, to castrate state consumer protection laws. So they get two things, federal direction of more money into their coffers and enhanced immunity from state laws. And they use progressives' willingness to use the federal government to solve a problem as a tool against progressive interests.
A public, not for profit option would address denial of service potential in addition to the cost of service concerns.