Two key insurance organizations have publicly announced their opposition to the "Affordable Health Choices Act," a bill introduced by Sen. Edward M. Kennedy (D-Mass.), chairman of the Senate Committee on Health, Education, Labor & Pensions.

The Independent Insurance Agents & Brokers of America (the Big "I") is opposed to several aspects of the bill: a Medicare-like public plan and a "pay or play" employer mandate, which Kennedy is pushing for. The Big "I" has stated that it will oppose any effort to implement a public plan, which would be unfairly matched against private plans, and an unreasonable employer mandate.

According to a 2009 Lewin Group Study, if the new government plan's reimbursement rates are similar to Medicare, an estimated 119 million people would shift from private insurance to the public plan. Private insurers could be driven out of business and a "single payer system" would evolve. Moreover, an employer mandate could have a devastating economic impact on small businesses.

"The Big 'I' supports efforts to provide universal health care coverage and to lower health insurance costs across the board," said Robert Rusbuldt, Big "I" president & CEO. "However, the current form of this bill is not the solution."

Another point of contention with the bill is the question of paying for reforms, according to Charles Symington, Big "I" senior vice president of government affairs.

"The cost of health insurance is on an unsustainable upward path, with the Centers for Medicare and Medicaid Services (CMS) projecting that health care spending will total $2.5 trillion this year and increase to $4.4 trillion by 2018," he said. "Something needs to be done soon, but this bill is not the answer and unfortunately doesn't even address the '$64,000 question': how to pay for the cost of enacting the health care reforms."

The Big "I" is also opposed to the creation of the "Navigators" grant program included in the legislation. This program would award grants to public and private entities to conduct public education, distribute information, and assist with health insurance enrollment. Kennedy's bill states that health insurance issuers, including agents, would be prohibited from participating in the grant program.

"A Navigators program would mistakenly entrust organizations with no prior health insurance background with the authority to advise individuals on their insurance decisions and would cut experienced and educated agents out of the process of boosting health insurance enrollment," Symington noted.

Ken A. Crerar, president of The Council of Insurance Agents & Brokers, shares Symington's concern about the Navigators program.

In a letter to the Senate committee, Crerar stated that "it would be a disservice to deny experienced insurance professionals from serving as a navigator in the exchange. ... to completely abandon the depth of knowledge and resources brokers provide the insurance marketplace as a distribution system and replace with one that is untested and inexperienced is potentially disastrous. It would be unfair to individuals or employers securing insurance through the gateway to entrust their insurance decisions to an entity with little or no experience in the insurance market."

Stating that the Council is firmly opposed to a government insurance plan, Crerar also urged the Senate committee not to institute community rating policies for groups larger than 50 because they would be a disincentive for employers to develop and implement wellness programs.

"To allow premium variances on behavior like smoking encourages companies and individuals to focus on increasing their health as a means to lowering costs," Crerar wrote. "We urge the committee to cap community rating at 50 lives to ensure medium and large companies continue to strengthen the health of their workforce."