Skip to comments.Rising insurance costs crimping companies' plans
Posted on 08/27/2012 6:39:52 PM PDT by 11th_VA
Western New York's three big health insurers are again seeking to jack up rates by significant amounts in some cases - and some employers are taking desperate measures as a result.
BlueCross BlueShield of Western New York is asking for double-digit hikes for most plans, while Independent Health Association and Univera Healthcare are seeking increases of mostly less than 10 percent.
The price hikes, detailed in the carriers' filings with the state Department of Financial Services, mark another year in which premiums are rising much faster than the rate of inflation or household income.
Already, that's crimped any plans for growing his company, Buffalo-based commercial real estate developer Plaza Group, which has 11 employees. Between health and workers compensation insurance, the costs of adding staff are prohibitive. "I wouldn't consider hiring anybody else now, anybody who would need health insurance. It just isn't worth it," he said.
He turned to Buffalo-based HR Benefit Advisors to find a less expensive provider for the half-dozen employees that get coverage. "I've had enough. It's just lunacy," he said. "I want him to look into something that's going to put a cap on this nonsense."
(Excerpt) Read more at buffalonews.com ...
Somebody gotta pay for all that free stuff.
Why should an insurance company get a state monopoly ever. Allow interstate competition per the original intent of the Commerce Clause.
And in the government’s usual manner of screwing things up even further, there will probably be a Fred Kinnan solution proposed to this problem.
Hey, didn’t President Zero promise that Obamacare would lower health premiums?
Emblem Health/HIP is going for a 40% increase.
Going for the kill before Obamacare kicks in?
You, nor I, nor anyone else have enough bribes to swing that one. Too many people are being paid off to keep the monopolies in tact.
It is all about power and corruption all the way around. Just about any politician you can name either quit working for his “subjects” or never did. They are all free lancers, opportunists and self-serving. It is just too good a deal for high-mindedness to survive. An honest man in politics is about as scarce as a virgin in a whore house. Marble halls or gaudy parlors it doesn’t matter same thing goes on in both places.
Not a monopoly ....but some states will MANDATE that if a company wants to sell medical insurance policies in the state, it meet all the state standards ....and standards vary between states.
Some states want the insurance companies to cover the important basics - sex change operations, drug and alcohol rehab, etc. And the state wants the end user to have things “free” (i.e. - no copay) ...so the costs skyrocket. Other states might allow a medical insurance company to offer “just the basics” - catastrophic coverage, while the end user has to pay out of pocket for the reasonable items like basic checkups, etc. Such policies can be very very cheap.
But - the “compassionate states” don’t want the unwashed and unenlightened end users to go and get those “cheaper policies” (because how else are you going to spread the costs for these wacko added mandates unless you force everyone to pay.) Imagine how cheap the policies would be if the company could have higher rates for smokers, non-compliant overweight & obese people who wouldn’t change their life style, exclusions for injuries or medical conditions brought on by drug use or alcohol abuse? The “enlightened states” want the risks to be equalized and borne by everybody - hence the inability of the healthy people to by cost-effective insurance out of state!
Obamacare IS kicking in.
Even though Obamacare won't be fully operative until 2014, when the indivual mandate kicks in, other elements are being steadily phased in.
This year, the insurers are hit with a whole raft of regulations and specified coverages that they must include in their policies. All of these things cost money -- and you'll be charged for it.
The only plans they should be working on is how to file for bankruptcy, as the government forces them to provide more and more services that eventually no one will be able to pay for, and the government itself will take over the business.....
I’ll tell you where this headed—the employers are going to stop paying for health care and let the workers find their own insurance. They will gladly pay the government fine and still be saving money. But I tell you what will happen after that starts to happens—the government fines will go up big-time.
“non-compliant overweight” That’s a chilling phrase. So we all have to be compliant to get insurance or care? So, when are they going to start peeking into people’s bedrooms to make sure they are not promiscuous or having risky sex?
The answer to all these issues is the free market without the politicians mandating what insurance companies must cover. If somebody wants insurance only for a catastrophic illness or accident, fine. If someone else wants the latest alternative treatment that never ends, let the insurance companies charge them extra. Right now, we all have to pay for people who see a counselor or a chiropractor week after week after week, because psychologists and chiropractors have good lobbyists. Scrap the entire system and open it up to competition. What we really need is LESS insurance and LESS government in health care and insurance.
Has anybody noticed that with the facist 80%/20% (Payouts/Overhead ratio) fascist rule in Obamacare, wouldnt the insurance companies react by simply raising policy premium rates so they fit within the Obama 80/20 rule, given their fixed amount of overhead?
They could generously offer fractionally more benefits to their insured policy holders so that the 80% payout is in a perfect ratio with their overhead amount.
For example, suppose their ratio was 79%/21% ...
Their revenue from premiums is, say 100 units (e.g. a million dollars), so if they raised their rates, and hence their revenues, to 104 units, with the extra 4 unit of revenues would all go to increased generous payouts for new items covered.
So on a units basis, theyd have 83 units vs 21 units, which is essentially a 80%—20% ratio. Voila! Now theyre in compliance with the heavy-handed Obamacare gestapo AND they get to keep their bloated administrative staff levels of their choosing. However, those paying insurance rates get even more screwed.
Another tragic side-effect of government tinkering in the free markets.
Nothing prevents an insurance company in State A from doing business in State B, but if they do so they must meet all of the regulatory standards of State B. One reason why New York is such an expensive place for insurance is that the regulations can be very onerous. On the flip side, New York also has a reputation for sound, stable insurance companies. It's kind of strange how that works, I guess. Historically, a state like New York with a well-run financial regulatory structure (despite the fact that its politics are so leftist) is looking to protect its citizens from fly-by-night insurance carriers from other states who may undercut New York insurance companies by selling insurance policies without the financial backing and reserves that NY requires.
The issue here really comes down to the Commerce Clause vs. the Tenth Amendment.
And that's when the employer lays off all the staff and either hires them back as contractors or moves their operation to another country.
The problem is state mandates that create local monopolies. Licensing and permitting don’t protect you from scoundrels or bad actors. That’s utter myth.
There is no conflict between the 10th and the Commerce Clause. The conflict is between individual liberty and state control. I should be able to cross state lines and buy whatever insurance I want as an individual.
That power is available to Congress and would create real competition. That way if I want a policy that is no-frills and “unmandated” I can get it. Let the state regulate all businesses within its borders, but it cannot regulate interstate commerce and that is what they’ve done.
Undo it and prices fall. It is absolutely pro-consumer and doesn’t need a massive bureaucracy to manage it.
Congress can, with a simple law, make it possible for me to buy insurance across state lines. No state can regulate another state. There need be no change to a local state’s laws regarding insurers in that state. Just let me buy the policy I want. It works in life insurance. Why is health insurance any different? You can add car insurance to that mix as well.
that bumpersticker on my car gets me the finger at least once a week...
or it might be the “trillion is the new billion”(with Barry’s logo)
The main culprit is lack of a national market for health insurance, which would greatly increase competition and thus lower costs to the consumer.
In turn, the main culprit for the lack of a national market is the 1945 McCarren-Ferguson Act, which exempted health-insurance providers from federal anti-trust regulation so long as the individual states took on the task of such regulation. The rhetoric and intent of the Act might have been consideration of the Tenth Amendment, but the effect has been different. The upshot has been to disempower consumers by making them, in effect, captive customers in their respective states; the wildly varying intrastate regulations providing an extremely powerful incentive to merge and “cartelize” within the individual states, while providing no incentive to trade between them. The lack of antitrust oversight, in turn, encourages, all those practices the feds claim they hate: price-fixing, rate-setting, and, in general, “restraint of trade” for the purpose of keeping prices high.
In principle, I’m not in favor of federal anti-trust legislation, as its history proves it usually hinders competition rather than promotes it. However, in the case of health insurance, I would certainly approve of a situation in which federal regulation at least made everything uniform so that an insurer in Wisconsin could seek a buyer in New Jersey without the insurer’s having to adjust his entire business operations to New Jersey state insurance law. The out-of-state policy could be regulated by New Jersey law in terms of possible situations like abuse, breach of contract, etc.; but the point is, the coverage of the policy wouldn’t have to adjust to New Jersey law and its particular special interests, lobbyists, etc.
It’s not ideal, but it’s better than the existing situation which caused insurers to become, effectively, a state monopoly; and certainly much better than the ObamaCare alternative which will incentivize health insurance to become a federal monopoly. Neither McCarren-Ferguson nor ObamaCare promotes INTER-state commerce, and neither does a thing for promoting or increasing competition.
You know the answer. The big insurers’ lawyers helped write ObamaCare in the back room of Harry Reid's office along with the unions, pharmaceutical makers and trial lawyers. The GOP had an opposing 250-page bill that included the abolition of state health insurance monopolies.
Bingo. That’s why this election is so critical. We’ve got the chance to in the first 100 days reset the clock in ways that the Democrats cannot defend against.
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