In theory, everyone was forced to buy insurance, sick or not, whether they could afford it or not, on the grounds it would lower costs for those with preexisting conditions.
In practice, insurance companies continue to jack up rates, so much so that Massachusetts has effectively instituted insurance price controls, rejecting 235 of 274 proposed rate increases because they included "excessive increases and rates unreasonable relative to the benefits provided."
Price Controls In Massachusetts
Inquiring minds waiting for Obamacare to deliver on promises might be interested in reading Mass. agency limits health premium increases.
Massachusetts regulators issued their first batch of health care price controls on Thursday, rejecting the vast majority of small business health premium increases sought this year by the state's major insurers.Three Questions To Ponder
Insurance Commissioner Joseph Murphy said he had disapproved 235 of 274 proposed rate increases because they included "excessive increases and rates unreasonable relative to the benefits provided."
The head of a group representing insurers, health care providers and an array of area businesses, termed the action "arbitrary and capricious" and said it would hurt insurance companies because they already have negotiated contracts with health care providers.
Michael Widmer, president of the Massachusetts Taxpayers Foundation, added: "The administration is seeking a quick fix, but this will only compound the problem."
Murphy's decision covered all 19 of the plan increases proposed by Blue Cross Blue Shield of Massachusetts, 63 of the 64 plan increases proposed by the Blue Cross HMO, all 47 proposed by Fallon Community Health Plan and all 36 proposed by Tufts Health Plan. The 33 plans offered by three out-of-state, for-profit insurers � Aetna, ConnectiCare and United HealthCare � all were approved. Each does relatively little business in Massachusetts.
Policyholders who have already made a premium payment under the disapproved rates will receive a refund or credit.
The announcement had political overtones: Gov. Deval Patrick, a Democrat, is seeking re-election this fall against a field that includes Republican Charles Baker, the former president of Harvard Pilgrim Health Care.
Twenty-five of the 26 increases proposed by Harvard Pilgrim were rejected.
- For Governor Deval Patrick: When do health care companies pull out of Massachusetts?
- For Challenger Charles Baker: Who are you beholden to?
- For everyone: What hath Obama wrought?
Two Certainties
- Plenty of health care mud will be flying in the mid-term elections.
- Wage and price controls never work.
Mike "Mish" Shedlock
http://globaleconomicanalysis.blogspot.com
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