Health insurers sue Massachusetts over 'premium rate caps'

[Hilarious Clinton 452]

Health insurance companies in Massachusetts are fighting back after the state's insurance commissioner last week rejected 235 of 274 proposed rate hikes, effectively implementing a premium rate cap. Six insurers--five of which belong to the Massachusetts Association of Health Plans, as well as Blue Cross Blue Shield of Massachusetts--filed a suit in Suffolk Superior Court, calling the cap a "reckless decision...based in politics."

The proposed rate hikes averaged between 8 and 32 percent. Massachusetts Gov. Deval Patrick and insurance commissioner Joseph Murphy called the numbers "excessive," and said that increases should instead be around 5 percent--on par with the medical consumer price index.

Small business leaders like Jon Hurst, president of the Retailers Association of Massachusetts, agree with Patrick and Murphy. "Big healthcare...has been living in an alternate economic universe," Hurst said. "They seem to have no understanding of what small businesses and their employees are going through in this recession. They cannot be allowed to continue to demand double-digit increases on Main Street during this difficult economy, while at the same time they are benefiting from the mandated health insurance law."

However Richard Epstein, a professor of law at the University of Chicago, sided with the insurers, saying that the cap, and a similar one imposed in Maine, essentially "shoots the messenger" rather than addressing the real issue of rising healthcare costs."

"Make no mistake about it, these healthcare insurers aren't clamoring for the impossible by insisting monopoly profits in a competitive industry," Epstein writes for Forbes. "They are asking only for rate increases that cover their losses from supplying the rich set of mandated benefits for all insureds, including those with pre-existing conditions."

Read more: http://www.fiercehealthcare.com/story/health-insurers-sue-massachusetts-over-premium-rate-caps/2010-04-06#ixzz0kLc4Vnwt

[Dan J 277]

So instead of working to cut costs, or put pressure on providers, they turn around and put spend money on lawyers and a lawsuit.

[Mr. Big Dog 10,747]

So instead of working to cut costs, or put pressure on providers, they turn around and put spend money on lawyers and a lawsuit.

Why cut costs? Profits are a percentage of the money they take in. The more they spend, the more they take in, the larger the profit - albeit a small margin of the total money collected. If they were to cut costs and collect less, then either they'd live with smaller profits (if the margin remains flat) or they'd have to increase the profit margin in order to maintain and increase their profits. So they keep running up cost, increase premiums by unsustainable rates annually and then sit there on billions of dollars of profits - trend rising - while pointing to the small profit margins in their defense.

[Jenn! 918]

Why cut costs? Profits are a percentage of the money they take in. The more they spend, the more they take in, the larger the profit - albeit a small margin of the total money collected. If they were to cut costs and collect less, then either they'd live with smaller profits (if the margin remains flat) or they'd have to increase the profit margin in order to maintain and increase their profits. So they keep running up cost, increase premiums by unsustainable rates annually and then sit there on billions of dollars of profits - trend rising - while pointing to the small profit margins in their defense.

Thank God for insurance regulation.

[Mr. Big Dog 10,747]

Thank God for insurance regulation.

You know it.

[luckytxn 2,264]

Like the part about them being mandated to pay for procedures and having to accept preexisting conditions but they are not allowed to recover the costs this entails. I would sue them also.

[Dan J 277]

Like the part about them being mandated to pay for procedures and having to accept preexisting conditions but they are not allowed to recover the costs this entails. I would sue them also.

Massachusetts already has mandatory health coverage, the costs from pre-existing conditions is already covered by a larger pool. This is about exploiting a de facto monopoly to protect excessive margins instead of doing what other companies have to do in tough market. Figure out how to cut costs.

[luckytxn 2,264]

It is the medicos that have to cut costs. The insurance has to pay for all the mandating and is being forced to eat the rising costs. If they want to mandate coverage then start mandating the costs of the medical procedures. Start mandating the professionals salaries.

[Dan J 277]

It is the medicos that have to cut costs. The insurance has to pay for all the mandating and is being forced to eat the rising costs. If they want to mandate coverage then start mandating the costs of the medical procedures. Start mandating the professionals salaries.

They will, if insurance companies can't pay them as much. Insurance companies have a lot of power when it comes to provider prices. But they would rather do mutual back scratching as long as they can get away with it. Its a win-win for the provider and insurance company.

[Pooky 3,784]

Why cut costs? Profits are a percentage of the money they take in. The more they spend, the more they take in, the larger the profit - albeit a small margin of the total money collected. If they were to cut costs and collect less, then either they'd live with smaller profits (if the margin remains flat) or they'd have to increase the profit margin in order to maintain and increase their profits. So they keep running up cost, increase premiums by unsustainable rates annually and then sit there on billions of dollars of profits - trend rising - while pointing to the small profit margins in their defense.

At last, someone appreciates the reason private insurance companies need to be cut out of the loop on the primary level of "healthcare". They are an inbuilt inefficiency in the system and will drive up the costs any way they can, to leech money out of it and into the pockets of their shareholders.

And yet this administration has mandated that everyone needs to have private health insurance. Anyone else think this is totally wrong?

[luckytxn 2,264]

At last, someone appreciates the reason private insurance companies need to be cut out of the loop on the primary level of "healthcare". They are an inbuilt inefficiency in the system and will drive up the costs any way they can, to leech money out of it and into the pockets of their shareholders.

And yet this administration has mandated that everyone needs to have private health insurance. Anyone else think this is totally wrong?

Yes most Americans think it is wrong and the mid terms will reflect that. Too bad the opposition party is part of the problem.

[Pooky 3,784]

Yes most Americans think it is wrong and the mid terms will reflect that. Too bad the opposition party is part of the problem.

Again, I have to agree. No-one in Washington has the courage to do what is right, and very soon the Electorate will let the incumbents there know just what they think.

I like the polls which show that a majority of the electorate think that there needs to be wholesale change in Congress. It might show that they are finally waking up to what's so corrupt about government here.

[Dan J 277]

Again, I have to agree. No-one in Washington has the courage to do what is right, and very soon the Electorate will let the incumbents there know just what they think.

I like the polls which show that a majority of the electorate think that there needs to be wholesale change in Congress. It might show that they are finally waking up to what's so corrupt about government here.

Switching to single payer is only possible in certain states. Not on a nationwide basis. The anxiety that conservatives and a number of independents would have to such a large change would kill any bill before it got to the floor. These people would rather get raped and pillaged by insurance companies than to do something major to fix it.

[luckytxn 2,264]

Again, I have to agree. No-one in Washington has the courage to do what is right, and very soon the Electorate will let the incumbents there know just what they think.

I like the polls which show that a majority of the electorate think that there needs to be wholesale change in Congress. It might show that they are finally waking up to what's so corrupt about government here.

Yeah we are going to get changed again. Changed to the poorhouse.

[Pooky 3,784]

Switching to single payer is only possible in certain states. Not on a nationwide basis. The anxiety that conservatives and a number of independents would have to such a large change would kill any bill before it got to the floor. These people would rather get raped and pillaged by insurance companies than to do something major to fix it.

Anxiety? You're kidding me, right?

It has little to do with anxiety and a lot to do with plain, old-fashioned money.