I received an email from someone I know on Twitter saying that she was getting amazing runaround from Anthem Blue Cross. After raising her individual policy premium by 20% for the 2010-2011 policy year, they were unable to offer her any alternatives for other policies she might switch to. Furthermore, they let her know that she would have to make a decision by September 22, 2010, because everything was changing on September 23rd.
The only problem with that? The service reps she spoke with had no idea what alternatives were available. In addition, they were working very hard to box her into the old policy at the new rate by telling her that any addition of a "preventive package" would result in a higher premium under a new policy but they couldn't tell her what that higher premium would be.
From her summary:
In theory I am entitled to switch to a lower cost plan with fewer benefits without new underwriting if I do it before October 1, 2010. But because some provisions of the health care reform act go into effect there are some plans I can only switch to before September 22, 2010. Today is Sunday, September 19, 2010.
Last week I tried to get information about what plans I could switch to without underwriting. On Wednesday, Sept. 15 and Thursday Sept. 16 I called the Anthem customer care line and spoke to a total of four Anthem Health Plan Advisers (H.P.A.s). Not one of them could quote me a policy premium for September 22 or 23. They gave me four different versions of how the health care reform act would affect my plan.
Of course, September 23, 2010 is when many of the big consumer protections take effect, including requirements to cover adult children until age 26, include free preventive care, end pre-existing conditions exclusions for children under 19, and eliminate lifetime and most annual limits on benefits. So why, at this late date, are individual insureds receiving confusing and mixed messages about what their options are?
In Connecticut, the Anthem subsidiary claimed delays were related to higher-than-expected premium increases for individual policies. Here in California, higher rates were approved already, so that shouldn't be the problem.
The major difference between rising prices this year and years past is the cost of new benefits added to health plans starting Thursday as mandated by the sweeping reform approved by Congress in March.
Insurers say the cost of new benefits will increase prices more than 20 percent for certain plans. But federal government officials and consumer advocates are crying foul, saying reform should raise premiums only 1 percent or 2 percent.
Anthem has also stopped the sale of any policies in California where the primary insured is under age 19, citing "regulatory confusion". I'm assuming they expect those insureds to be covered on their parents' insurance but that's a pretty big leap, given that many unemployed parents chose to insure their children with individual policies when they were excluded because of pre-existing conditions and couldn't afford to maintain COBRA coverage. This really forecloses anyone who is self-employed or unemployed from insuring their children at all if they can't afford coverage for themselves.
There's a lot of criticism to be leveled here. It's obvious that insurers are leveraging rate increases and changes made by the reform law to foment discontent and negative attitudes toward the new law. They've been doing it for six months now, beginning with small employers and now with the individual market. Make no mistake, this is a battle royale. They're fighting for the right to control the narrative and our health while influencing elections. They know that whatever they do will play to the liberals out there who felt the law didn't go far enough, as well as the right wing who croons Anthem über alles at every available opportunity.
But right now at this moment, insurance commissioners are the biggest problem. Premium increases are approved or denied by insurance commissioners, and California's is Steve Poizner. Poizner recently lost a bid for the GOP Senate nomination to Carly Fiorina by running to her right. Despite his claim of populist sympathy, he's as much a corporate-owned man as any other Republican. And despite the fact that his office did actually get back to the person who contacted them about Anthem, they weren't much help. Not only weren't they much help, they allowed the increases Anthem requested after making a big fuss during primary season about those very same increases.
Kathleen Sibelius has put AHIP on notice about this, but it's going to take more than letters. They're going to have to start enforcing the law, and that should start with full disclosure about how premium rates are derived. My sense of things is that insurers have decided to front-load their premium costs and rebate customers at the end of the year for the difference between their medical-loss ratio and what they collected.
Sibelius was clear:
According to our analysis and those of some industry and academic experts, any potential premium impact from the new consumer protections and increased quality provisions under the Affordable Care Act will be minimal. We estimate that that the effect will be no more than one to two percent. This is consistent with estimates from the Urban Institute (1 to 2 percent) and Mercer consultants (2.3 percent) as well as some insurers’ estimates. Pennsylvania’s Highmark, for example, estimates the effect of the legislation on premiums from 1.14 to 2 percent. Moreover, the trends in health costs, independent of the legislation, have slowed. Employers’ premiums for family coverage increased by only 3 percent in 2010 – a significant drop from previous years.
Yes, many of you are nodding right about now and grumbling -- grumbling sentences that have the words "single payer" and "public option" in them. Evidently health insurers also want a public option or single payer, because they are surely behaving in a fashion that is inviting such legislation to find its way into a technical corrections bill.
Whatever the ultimate outcome here in California and nationally, repeal is not the answer to the problem, despite Republicans' fervent promises.
Although the effect of these changes on individual premiums will vary a lot from person to person, the CBO concluded that, once you account for the subsidies, reform will mean lower average premiums for people with private insurance. Repeal reform and these people are stuck paying more (unless Republicans are willing to let benefits get a lot more skimpy). The official projections also suggest that, ten years from now, government spending on health care will be lower than it might otherwise be. Repeal reform and the deficits go back up -- by more than $100 billion over ten years. And while the nation as a whole will pay slightly more for health care over the next ten years, the rate of growth -- which is the figure we care about most -- will be lower. Take away reform and, according to the projections, health care costs will rise at a higher rate.
This is the battleground, then. Republicans and insurers versus the rest of us. The pathway out is going to be getting out the vote, not handing Congress back to the Republicans. Then we push hard and like hell to whip Medicare into shape and begin to open it to individuals as a buy-in option.