Health Care Reform: Holding states and insurers accountable

(An excerpt of my weekly article in

For years health insurance premiums have risen and states have done little to nothing to stop it. Insurance commissioners have signed off on these increases with little more than a cursory glance at the latest actuarial tables shoved under their noses by the dominant insurers in their regions. I get it. For one, commissioners don’t have enough resources to adequately ascertain whether health insurers’ estimates actually match up. Second, their power is mostly muted so they’re really just armed with a recycled rubber stamp. Seemingly, they have tortured President T. Roosevelt’s well known words and have sadly subscribed to their own: Walk softly and carry an even softer stick.

For instance, recent stories out of California have shown what can go wrong when commissioners are asleep at the switch. The California Department of Insurance has filed suit against Pacificare for violating state law 1 million times in a two year period. Violations ran the gamut from late processing of doctor’s reimbursements to rate changes to slow approval of new providers. This has led to higher, out-of-network charges for patients and missed treatments. The fines sought add up to nearly $9.9 billion. And worse yet, these offenses allegedly took place after United Health Care, one of the largest insurers in the country, purchased them. So it begs the question: As health insurers get bigger do they get worse?

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