High Time To Cure Insurance Debacle
More than 400,000 insurance consumers are getting hurt right now as a direct result of the Washington state Legislature’s manipulation of the health insurance market.
The 400,000 voters are those who buy individual health insurance policies. They work at businesses too small to offer group insurance. The cost of individual health coverage is high - and rising rapidly. Insurers who sell individual policies say they’re suffering heavy losses and are seeking 20 percent to 30 percent rate increases. Rates for group health insurance, meanwhile, are comparatively flat.
In 1993, the Legislature passed a law that, in essence, would have made group health insurance available for everyone. Last year, the Legislature repealed that law. But the Legislature did retain a few of 1993’s most popular mandates - requiring that anybody who applies for health coverage must get it and that applicants with a pre-existing medical condition must receive coverage for the condition three months after they begin paying premiums. Before 1993, insurers could refuse to insure applicants with a costly condition. That forced the uninsured to get care in emergency rooms, which shifted the cost, via inflated hospital fees, onto people with group insurance.
The reforms prompted a rush on individual insurance by those who hadn’t been able to get it before. The short three-month wait for coverage for pre-existing conditions meant people could get expensive care for the price of a few months’ premiums, then drop coverage again.
Insurers who sell only group policies want to ignore this problem. Insurance companies who do sell individual policies, such as Blue Cross, want legislative action.
It is not in the public interest to make individual coverage unaffordable or to reignite the pre-1993 cost-shifting.
The best solution, backed by responsible insurers as well as state Insurance Commissioner Deborah Senn and the state’s Health Care Policy Board, is to tax all health insurance firms and put the revenue in a “reinsurance” fund that would cushion individual-insurance carriers against major losses, stabilize rates and keep individual coverage viable. In addition, Blue Cross favors lengthening that three-month wait for coverage of pre-existing conditions to discourage consumers from popping in and out of the insurance market.
The Legislature made this mess and caused the current suffering. Therefore, it has a duty to adopt reforms. Now.
, DataTimes The following fields overflowed: CREDIT = John Webster/For the editorial board