The BIG Four Insurance Companies in California – Aetna, Anthem Blue Cross, Blue Shield and Health Net, collectively control 90 percent of the state’s individual insurance policies.
The State Insurance Commissioner recently granted their requests to hike insurance premium rates for individual policies for more than 1 million Californians beginning October 1. According to the Los Angeles Times, “the insurance department has no authority to block rate hikes as long as they comply with California law, which requires insurers to devote at least 70 cents of every premium dollar to medical claims.”
The BIG Four’s double-digit rate hikes are:
- 19-29 % for Blue Shield’s 250,000 customers;
- 14-20 % for Anthem Blue Cross’s 800,000 individual policy holders;
- An average 19 % for 65,000 Aetna policy holders; and
- 16-25 % for Health Net’s 38,000 individuals.
For those who are self-insured and cannot afford these steep rate hikes, there could be another option. On March 9, 2010, HR 4789 – The Public Option Act – also known as the “Medicare You Can Buy into Act” was introduced by Congressman Alan Grayson (Florida). HR 4789 was referred to the House Ways and Means Committee. HR 4789 is simple. It allows every citizen and permanent resident of the United States to buy into Medicare coverage with no cost to taxpayers.
According to Congressman Alan Grayson, the Medicare You Can Buy Into Act scores at zero or better by the Congressional Budget Office because the bill “specifically says that it has to pay for itself.” Grayson says the premiums are “very reasonable – barely $500 month for people in their 60s, down to $100 a month for children.”
As health insurance premiums in California and around the nation increase more people will be dropped from private insurance coverage for failure to pay their premiums – which means a bigger burden to society when people become ill and appear at hospital emergency rooms.
Grayson’s simple public option plan is more cost-effective for many individual’s who are held hostage now by the BIG Four. Buying into Medicare’s larger insurance risk pool brings down individual premiums.
The BIG Four acts similar to an Oil Cartel that controls supply and profit. With insurance companies, the profit comes in the form of higher insurance premiums and from limiting and excluding treatments.
The health insurance industry was fearful that a public option would cut into their profits so their lobbyists and astro-turf funded groups scared the public and seniors during the health care reform debate with their “death panel” and “rationing” baloney.
For many who cannot afford to pay higher premiums during these tough economic times, Californians and the nation needs an option. As one person wrote recently: “This has eaten my entire pension” and is “going to eat up my food money. Since my wife is dealing with lung cancer, I am forced to find the money.”
You can help by immediately contacting your Congressional Representative and U.S. Senators to ask them to vote on this Life-Saving bill.
Tracy Emblem is an attorney in Escondido.