Monday, May 17, 2010

Coming Soon to a State Near You

The problems in Massachusetts are just beginning to surface. The land of Chappaquiddick and RomneyCare is on the verge of having health insurance companies pull out of the game.

Boston reports that the 4 largest health insurance carriers lost more than $150 million in the first quarter of this year.

The cause?

Rate caps.

Blue Cross Blue Shield of Massachusetts, the state's largest health insurer, reported a $65.2 million net loss for the three months ending March 31. Its operating loss was even steeper, $95.5 million. The company drew $55 million from its reserve to cover the anticipated losses from the state-imposed premium cap in the second quarter, accounting for the majority of its operating loss.

So what happens if the carriers continue to lose money?

Bailout or pull out.

Washington, are you listening?

Probably not.
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