Insurers Raise Rates, Cancel Plans In Response To Overhaul

The Wall Street Journal: "Aetna Inc., some BlueCross BlueShield plans and other smaller carriers have asked for premium increases of between 1% and 9% to pay for extra benefits required under the law, according to filings with state regulators." The requests undermine "Democrats' efforts to trumpet their signature achievement before the midterm elections." The insurers are saying they will have to pass on more costs related to the overhaul to their customers than the federal government predicted. "The rate increases largely apply to policies for individuals and small businesses and don't include people covered by a big employer or Medicare"  (Adamy, 9/7).

Separately, the Los Angeles Times reports, Health Net Inc., a "California health insurer got the green light Tuesday to raise premiums an average of 16% for 38,000 policyholders who buy insurance on their own. The go-ahead from the state Insurance Department comes less than two weeks after it approved double-digit hikes by Anthem Blue Cross and Blue Shield of California. The state has yet to rule on a pending rate increase by Aetna Inc." (Helfand, 9/8).

The Dallas Morning News highlights another approach insurers are taking: Canceling health plans. A letter to customers from Grand Prairie-based National Health Insurance Co. said the firm would not renew its health insurance policies because of the overhaul. "The cancellation highlights one way the new law is reshaping the health care landscape in North Texas and elsewhere. Some health economists say more small insurers may soon buckle under the weight of the law's mandates." The biggest concern for the insurers is a requirement that plans spend at least 80 percent of premium dollars on patient care. Federal officials said cancellations are premature. The newspaper notes that National Health "has had financial troubles for at least three years," but does not say how many policies are being canceled (Roberson, 9/8).

And, The Colorado Independent reports, five insurers in that state will no longer offer health insurance policies to children whose parents are not also on the plans. "The insurers say offering child policies made business sense when they could just cover healthy kids but that since federal law now requires them to offer insurance to all kids, including kids with pre-existing medical conditions, they are withdrawing from their child-only plans" (Tomasic, 9/7).