As reported by Time today, consumers in California, Maine, Indiana, and Oregon are being hit with rate increases of at least 15%.   Medical Inflation is at 9%. 

13 million Americans buy insurance for themselves.   As more employers drop coverage, more Americans will be forced into the individual market – where they have no ability to negotiate on price.

In an interesting related news, USA Today reported  the top 15 Health Trade Groups increased their political spending in 2009 by 14%.   

Consumers need to know where their premiums dollars go.   The time for rate reform is now.

Oregon is providing a model for the rest of the country by making all health insurance rate filings public.

In contrast to California where consumers have no information about how Anthem is justifying its recently announced 39% rate hike, starting April 1st Oregonians will have access to all of the information health insurance companies file for rate hikes.  The Oregon Insurance Division must review health insurance rates for individual, small employer (2-50 employees), and portability plans before they take effect in Oregon.

New rules adopted today put in place reform passed by the 2009 Legislature.  These include:

• A 30-day period for the public to comment on rate requests.
• More detail about what insurers spend on salaries, broker commissions, marketing and advertising, and other administrative expenses.
• Ability to consider an insurer’s overall profitability rather than just costs for a particular type of insurance such as individual health plans.

We applaud Oregon for giving consumers the information they need.  The rest of the country could learn a lesson (especially the state to the South of the border of Oregon).

As reported in the New York Times today,  Anthem has provided “Exhibit A” for Health Reform.

Anthem Blue Cross, has agreed to delay the rate hikes in California until Insurance Commissioner Steve Poizner has had time to review whether Anthem has spent at least 70% of premiums on health claims, as required by state law. In this case, it will probably mean just a 2 month reprieve for consumers from the outrageous rates.  (Even though Wellpoint posted record profits in the last quarter of 2009, this review is limited to the California individual market.)

Consumers deserve full disclosure about how much of their premium dollars goes towards actual health care services – and how much goes towards lobbying to defeat health reform, advertising, and administrative overhead –bonuses fall in this category.

Federal bills would require 80% of premiums be used for health services in the small groups and indiviudal markets and 85% in the large group markets.

Check out these blogs for more information about how health reform would help prevent these rate hikes:

Anthony Wright at The Treatment, the health policy blog of The New Republic and Ezra Klein at The Washington Post.

The CA Assembly Health Committee will hold a hearing on the premium increases on February 23rd.  On th 24th, Energy and Commerce Committee Chairman, Subcommittee on Oversight and Investigations will hold a hearing.