You didn’t have to be a cynic to think insurance companies would try to find loopholes in the health care fix. But I must confess, even I am a little surprised at their first stab at it. On the list of individual parts of the reform that would be hard for them, or for politicians pushing repeal, to take back, this one would rank pretty high.
Yup, the insurance companies went after kids. Specifically, they said that while the law said they couldn’t deny kids for having pre-existing conditions, they just didn’t have to sell insurance to the entire family of a sick child. No, really.
Insurance industry lawyer William Schiffbauer told the New York Times, “The fine print differs from the larger political message. If a company sells insurance, it will have to cover pre-existing conditions for children covered by the policy. But it does not have to sell to somebody with a pre-existing condition. And the insurer could increase premiums to cover the additional cost.’’
This did not go over so well with policymakers such as Nancy Pelosi and Health and Human Services Secretary Kathleen Sebelius.
And the insurance companies backed down. This time.
In a letter to Health and Human Services Secretary Kathleen Sebelius, the industry’s top lobbyist said insurers will accept new regulations to dispel uncertainty over a much-publicized guarantee that children with medical problems can get coverage starting this year.
Quick resolution of the doubts was a win for Obama — and a sign that the industry has no stomach for another war of words with a president who deftly used double-digit rate hikes by the companies to revive his sweeping health care legislation from near collapse in Congress.
“Health plans recognize the significant hardship that a family faces when they are unable to obtain coverage for a child with a pre-existing condition,” Karen Ignagni, president of America’s Health Insurance Plans, said in a letter to Sebelius. Ignagni said that the industry will “fully comply” with the regulations, expected within weeks.
Anyone have any bets on which provision the insurance companies will go after next?
So, Anthem Blue Cross totally needed to raise rates on individual policy holders in California by up to 39%. They were losing money, people! (On the individual market in California, while making giant profits overall.) Just trying to staunch the bleeding! (They told us.)
Internal emails tell a different story. You might need to sit down before reading this, but: The rate increases were to increase profits, not minimize loss. Who could’ve guessed?
This came out yesterday at a hearing held by the House Energy and Commerce Health Subcommittee, where Representatives Waxman and Stupak read out some internal Anthem emails.
– “The average increase is 23 percent and is intended to return California to a target profits of 7 percent, versus 5 percent this year.” [WellPoint email, October 7, 2009]
– “We’re asking for premiums that would put us $40 million favorable…if we get the increases on time, we will see an opt gain upside of $30 million downgrades and rate cap.” [WellPoint email, November 2, 2009]
– “[W]e needed to reach agreement on filing strategy quickly — specifically in the area of do we file wth a cushion allowed for negotiations.” [WellPoint email, 10/24/2009]
Company-wide profits aren’t enough for them. Profits in California aren’t enough for them. No, every single area of business has to be profitable for them. What’s next? How far does it get subdivided? “Well, yes, we were making money on individual policyholders, but we weren’t making money on individual policyholders over 60, so we had to raise their rates by 73%”?
This is why there needs to be meaningful competition and meaningful cost controls. This is why a public insurance option is the best choice – because when individual policy holders got their letters announcing a 39% increase, they’d have somewhere to go. And don’t you think maybe that would make Anthem rethink whether to send the letters to begin with?
Anthem’s rate hikes in California are only the beginning. Dramatic rate hikes are expected in a number of other states. HHS Secretary Kathleen Sebelius is releasing a report today. From TPM:
Among the findings:
Anthem of Connecticut requested an increase of 24 percent last year, which was rejected by the state.
Anthem in Maine had an 18.5-percent premium increase rejected by the state last year as being “excessive and unfairly discriminatory” – but is now requesting a 23-percent increase this year.
In 2009, Blue Cross/Blue Shield of Michigan requested approval for premium increases of 56 percent for plans sold on the individual market.
Regency Blue Cross Blue Shield of Oregon requested a 20-percent premium increase.
UnitedHealth, Tufts, and Blue Cross requested 13- to 16-percent rate increases in Rhode Island.
And rates for some individual health plans in Washington increased by up to 40 percent until Washington State imposed stiffer premium regulations.
You might think that in a time of deep recession, with over 10% unemployment that they might scale back a little – but clearly these companies have no shame.
This says it all:
“[P]rofits for the ten largest insurance companies increased 250 percent between 2000 and 2009, ten times faster than inflation,” the report finds.
And this really sums it up: Pirates of the Health Care-ibean
We’re not screwing around this Halloween. Ghosts, bats, vampires…whatever. If they can make it into a “sexy ______” costume by throwing some teeth or ears or whatever in a bag and putting a picture of a woman in said teeth and ears and a cheap miniskirt on the front, how scary can it really be?
On the other hand, try making a health insurance company into a sexy Halloween costume. Can’t be done—those guys really are scary.
But we have made them into some of the scariest pumpkins ever. Check it out:
That there is a pumpkin that will deny you for a preexisting condition in a heartbeat.
