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March 18, 2004

GOP to Give Pay Day to Insurers

The GOP, seeing problems in abuses of the insurance market, want to end lax regulation by state governments and establish tough, uniform national regulation.

Okay, that was funny. Now let's talk about what's really happening.

Now that states are cracking down on abuses by insurance companies, including seeking cost controls by health insurance companies and preventing them from discriminating against many consumers, the GOP wants to end that state independence.

Mr. Oxley's legislation, to be discussed at a hearing in Washington in late March, would force the states to adopt uniform standards and permit the market to determine insurance prices rather than have them determined by regulators as is generally the case now.

That is music to the ears of many of the biggest insurers. Once content with sluggish state regulation as long as it remained relatively lax, they have been campaigning for a single federal regulator to replace those in each of the states as competition with banks and mutual fund companies has intensified. The insurers say they want efficiency: one-stop shopping and quicker approval of new insurance and investment products. Their critics say that they want less regulation and that customers would suffer.

One force driving the initiative is a desire to end what Mr. Oxley called "the travesty of price controls" in the insurance industry by allowing the market to set prices. He said his changes would increase profits for an industry that has been lagging behind banking and other financial service businesses and would give customers more choices.

Forget "states rights"-- the modern GOP use that term only to represent their racism, where they want to let racist states do what they want, but when it comes to most legislation, the GOP hates state autonomy, since their corporate buddies want strong national preemption of local regulation.

It's all about more and more paydays for rich corporations.

Posted by Nathan at March 18, 2004 07:57 AM