What the 2010 Election Means for Insurance IT

Before the results of the midterm elections held yesterday, Nov. 2, I had an exchange with Reed Smith attorneys Chris Cwalina and Amy Mushahwar about the potential effects of the election. Chris and Amy affirmed what they called the conventional wisdom that the House would go GOP and that the Senate would remain under Democratic control, and they offered several observations, focusing on issues of security and privacy. Today I also fielded some commentary on the effect of the election results on healthcare reform from Kunal Pandya, an analyst with Aite Group.

Owing to Republican control of the House, Democrats will lose the prestigious chairmanship for the Commerce Committee, my Reed Smith contacts noted in a co-authored message. “This committee is responsible for well over half of U.S. legislation, including all privacy measures,” they wrote. “Fred Upton [R-MI] is the Republican favorite, but Rep. Joe Barton [R-TX] would like to regain control over this committee too.”

With regard to privacy legislation, Cwalina and Mushahwar counseled watching the Boucher-Stearns bill. At press time they had not responded to a question about the likely impact on the bill’s fortunes of the loss of bill sponsor Rick Boucher (D-VA) to his GOP challenger Morgan Griffith — a result lamented in some quarters as a defeat to the technology and telecom communities.

In the Senate, the Senator Lieberman Cyber security bill is likely to advance, according to the Reed Smith attorneys, “because Connecticut Senator Joseph Lieberman will gain even more power as the Senate control margin narrows. It will also be important to watch which party Lieberman caucuses with, as he is an Independent.” Lieberman caucused with the Democrats prior to the election.

With regard to the effect of the election on the 2012 election, Cwalina and Mushahwar predict that divided government will slow down the Democrats’ high priority issues, including financial reform refinements, cap and trade, etc. “The Obama administration may want to show some accomplishments on third-tier political issues, such as privacy, that are not seen as controversial — and not likely to be seen by the Republicans as a political win for 2012,” the attorneys say. “The Obama administration could use legislation to show progress, but it is more likely that we will see privacy and cybersecurity measures coming from the expert agencies.”

Republican control of the House will inevitably precipitate renewed discussion about the course of healthcare reform, according to Aite Group’s Kunal Pandya.

“As of now it seems that the major areas such as the healthcare exchanges will go on as planned, but the coverage timeline of 2014 will likely change to 2019, as proposed by Republicans,” Pandya comments. “In relation to the coverage guidelines, we will have to wait and see what areas the House will target, but it will certainly open the gates for new discussions around medical loss ratios, tax increases on medical equipment providers, payments guidelines to providers and coverage guidelines.”

Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio