“Unreasonable” health insurance premium increases … will the politics never end?

2013

From the LA Times May 2, 2013

California Insurance Commissioner Dave Jones said the nation’s largest health insurer, UnitedHealth Group Inc., is imposing unreasonable rate hikes on about 5,000 small businesses.

Jones said Wednesday that UnitedHealth couldn’t justify the average annual increase of nearly 8%, which reflects both higher premiums and a reduction in benefits. He said the rate hike, which went into effect Wednesday, affects up to 45,000 small-business employees and dependents and represents $12.5 million in higher costs.

“At a time when small businesses are struggling to survive, UnitedHealthcare’s rate increase is just one more unwarranted economic burden on California’s small business owners and their employees,” Jones said.

UnitedHealth, based in Minnetonka, Minn., said it was “disheartened” by Jones’ comments and that the average annual increase for these customers is less than 2%.

Looking at this objectively and reading the sentence I placed in bold, can you see any logical connection between a rate increase of any size and the assertion that small businesses are struggling? In fact, there is no connection between the two. If there were, then the same logic would apply to every expense these businesses incurred. If in fact the proposed rate increases were “unreasonable” or “unwarranted” the employer could switch carriers as they would with any supplier, but that is not the real point.

The point is that as long as we allow politics and inflammatory rhetoric to set policy we are never going to solve the health care cost problem. Insurance companies need to make money, but they are not stupid, they don’t arbitrarily raise premiums that attract political and customer ire, especially in today’s climate.

Premiums are going up because health care costs are going up and because the Affordable Care Act significantly increases costs for those organizations providing coverage and paying the bills be it a self-insured employer or an insurance company … and that’s the truth.

You know, living on a fixed income I don’t think the increase I just received in property taxes is warranted. Do you know a politician I can talk to?