Bills call for cracking down on insurance industry
Steven K. Paulson, Associated Press
Originally published 03:52 p.m., March 30, 2008
Updated 03:52 p.m., March 30, 2008
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Democrats plan to introduce a package of bills to require health insurance firms to get prior approval for rate hikes, punish them for improper denial of claims and encourage efficiencies.
The plan, dubbed the Insurance Rate Accountability, Transparency and Equity Act of 2008, was unveiled at a news conference Sunday afternoon. It was first reported by The Associated Press.
Rep. Morgan Carroll, a Democrat from Aurora, said insurance companies currently are allowed to increase rates at will and get approval from the Division of Insurance later. She said they are rarely punished if increases are found to be unjustified.
"This way, people will know they are getting good rates, they are getting what they paid for and costs will go down as they become more efficient," Carroll said.
Carroll said she is considering adding auto insurance in a separate measure.
House Speaker Andrew Romanoff, D-Denver, is sponsoring a bill that would impose penalties if a claim is improperly denied. He said Coloradans deserve coverage that counts.
"We ought to make sure you get what you pay for, you don't pay too much and you see what you are getting," Romanoff said.
Carroll said Colorado's health insurance rates are seventh highest in the nation, according to the Kaiser Family Foundation, even though Coloradans are healthier than residents in most states.
She said auto insurance rates also are too high, even though the state went from no-fault insurance to a courts-based system. Carroll said that in 2002, one dollar of a typical insurance premium purchased $188 in benefits. In 2007, that same dollar only bought $46 worth of coverage.
"The industry says the current system is working. It's not working," she said.
Carole Walker, spokeswoman for the Rocky Mountain Insurance Information Association, said the reform package would drive up auto insurance rates, not lower them. She said states that require prior approval for rate hikes sometimes take as long as two years to make a decision, which pushes insurance companies to ask for even higher rates because they can't predict what will happen that far out.
Walker said most rate hikes are found to be justified and that the proposed plan would only delay the inevitable.
"They still have to be applied," she said.
Mike Huotari, spokesman for the Colorado Association of Health Plans, said Colorado law already requires health insurance carriers to submit rate increases with supporting information and that the Division of Insurance has the authority to reject rates that are inadequate, excessive or discriminatory.
He said rate increases are driven by technology and improvements in health care, not profit, waste and administration as critics charge.
"The only thing this will do is add to the cost of complying with the new rules and the cost to the state of administering them," Huotari said.
On the Net: Kaiser Family Foundation: http://www.statehealthfacts.org
Comments
Posted by PajamaPulitzer on March 30, 2008 at 5:21 p.m. (Suggest removal)
Good luck getting health coverage in Colorado once these Dumocrats are done.
Posted by JayinDenver on March 30, 2008 at 6:37 p.m. (Suggest removal)
How about that ackronymn?: "IRATE". Do you find that helpful?!
Post ten reasons how illegal aliens have helped Healthcare in the US.
Posted by infidel91 on March 30, 2008 at 7:46 p.m. (Suggest removal)
After this has driven up health insurance costs, the left will blame it on our "free market" in medicine . . .
Posted by JDT on March 30, 2008 at 8:49 p.m. (Suggest removal)
More unfunded madates by the government...Is the government going to pay for the costs or are we as consumers? We are...
Posted by gr8fun4me on March 30, 2008 at 9:30 p.m. (Suggest removal)
I'm glad they are going to regulate the insurance companies. I'm in perfect health, never been in a hospital, nothing. One day I had a growth on my larynx. They took it off. Four months later I was LA doing a job and I felt something move in my throat. I went in and they told me it grew back. I hadn't changed insurance companies or jobs. The insurance company refused to pay saying it was a pre-existing condition. What a joke! I had to file a complaint with the division of insurance in Georgia because the insurance company splits itself up in each state. For instance Blue Cross will form a division in Georgia but do business in another state, which is what they did. Our Colorado Division of insurance then has no jurisdiction over it. That is joke! Why are we spending taxpayer dollars on the Division of Insurance if they don't have jurisdiction over the companies that operate in our own state? They finally paid it after two months of hassling. I recently had an unpleasant experience with Nationwide auto insurance. One of their clients hit my wife's car and they refused to pay to fix it. They tried to total the car just because it was old. I had to fight and fight and fight. This took four months. Again my persistence is the only thing that got me the money to get my car fixed. Insurance companies are necessary evils, they all need to be regulated, the real question is how much. Greed is destroying this country.
Posted by gethoht on March 31, 2008 at 12:25 a.m. (Suggest removal)
Idiots idiots idiots. Profiting off of human misery is a horrible business to be in(which is what insurance companies do). The health care crisis in america is abhorrent, a black eye on this great country. Single payer healthcare(ala canada) is the way out of this ridiculous mess.
America spends about 15% of its GDP on health care. Most other industrialized countries (all of whom have some form of universal care) spend about 11-12%. According to the WHO, Canada spends a bit over 9% -- and most of the problems within their system come out of the fact that it's chronically underfunded compared to the international average.
Any system that has people spending more and getting less is, by definition, not efficient. And these efficiency leaks are, almost entirely, due to private greed. There is no logical way that a private system can pay eight-figure CEO compensation packages, turn a handsome a profit for shareholders, and still be "efficient." In fact, in order to deliver those profits and salaries, the American system has built up a vast, Kafkaesque administrative machinery of approval, denial, and fraud management, which inflates the US system's administrative costs to well over double that seen in other countries -- or even in our own public systems, including Medicare and the VA system.
Not incidentally: one of the benefits of single-payer health care is that it largely eliminates the entire issue of "fraud." You can only "cheat" a system that already views its primary business as rationing and withholding care. In Canada, where the system is set up to deliver health care instead of profits, and medical access is considered a right, this whole oversight machinery is far cheaper and more compact. In general, the system trusts doctors and patients to make the right choices the first time. As a result, people generally don't have to lie, cheat, and grovel to get the system to deliver the care they need. They just go and get it -- and walk out without a moment's dread about the bills.
Shareholder profit, inflated CEO salaries, and top-heavy administration -- all of which serve to work against the delivery of care, not facilitate it -- are anti-efficiencies that siphon off 20-25% of America's total health care spending. These are huge sums; yet it's mostly money down a gold-plated rathole. In the end, it doesn't provide a single bed, pay a single nurse or doctor, or treat a single patient.
You can learn more at: http://www.ourfuture.org/blog-entry/m...
or
http://www.ourfuture.org/blog-entry/m...
If you're too lazy to read those sites, post your ignorant ideas about why american healthcare is better than the rest of the worlds, and I'll shoot them down like ducks in a row....
Posted by widenerdonald on March 31, 2008 at 1:29 a.m. (Suggest removal)
Insurance Companies, Oil Companies and G.Bush is the reason why this Country is in such a mess! We did to do something, the more we wait the deeper we get in this mess!
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