Saturday, April 10, 2010

Massachusetts Standoff

The standoff between insurance carriers and the Massachusetts regulators continues.

The carriers want rate hikes on health insurance premiums while the DOI expects them to continue to write new business at last years rates.

While insurers were told to have their revised rates ready by yesterday, Connector spokesman Dick Powers said none submitted updated rates by the end of the day. Because it takes time for the Connector to load and test new rates on its software, he said, they aren’t likely to be available until the middle of next week at the earliest. The Connector was created by the state’s 2006 health care law to help people obtain coverage.

Jamaica Plain software engineer David Heimann, who is out of work, was unable to purchase health insurance on the Connector site this week because state regulators ordered insurers to remove the rejected rates, which the companies had already posted. Heimann said he also couldn’t buy a policy from individual carriers yesterday.

This is what happens when government decides to dictate to private industry what they can and cannot do.

“We expect the carriers are going to supply consumers with accurate information about their prices, and that the prices are going to be based on April 2009 rates,’’ Anthony said.

“Carriers have a legal obligation to sell insurance, and no individual or small business should be denied coverage,’’ she said. “If we get complaints from consumers who are trying to buy insurance and they’ve been denied, we’ll investigate and take appropriate action.’’

A legal obligation to sell a product at a loss.


Just because Medicare, Medicaid, Social Security, et al can operate at a loss doesn't mean private industry can as well.

This scenario is merely a different verse of the same song that led to the mortgage meltdown where government told banks they had to make loans to anyone regardless of their ability to pay back the borrowed funds. We know how that one turned out.
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