The Media has started its daily drum beat criticizing rate increases as carriers work to implement the Affordable Care Act. Don’t be fooled!!

January 16, 2013

Beginning just after the façade known as the “fiscal cliff”  lost its media luster the national media began its blitz of stories concerning health insurance carrier’s request for rate actions across the US. Actions that are needed, by the way, as the american health insurance carriers prepare for 2014 and the final stages of ACA implementation. As I say above, do not be fooled by this.

This is the media’s collusive effort, with supportive Democrats, to demonize the insurance carriers and thus push our citizens into giving state legislators and state insurance commissioners absolute rate authority. Media stories will criticize insurance carriers as being greedy and try to make the case that the premiums asked for by carriers are not necessary.

What other industry on the planet is told what to produce, how to offer it, what must be covered including experimental treatment, threatened about their product, then restricted to what the company needs to charge for the product. None.  No other industry except the american health insurance company.

Two things to remember:

1. Carriers are mandated to accept individuals guaranteed issue with no pre-existing condition limitation, with mandated benefits for maternity, preventive, and lifetime limits. But citizens are not forced to buy the product until they get sick and will then be willing to buy the coverage. No, I did not forget about the Mandate Tax Penalty but get real…is $95 per year tax going to encourage any person to buy insurance before they need it?
2. Also, because of the massive mandated benefits, restrictive pricing, no underwriting, etc, the carriers really have few options to consider when pricing their product. They are not allowed to give too many options and of course if they misprice their product and run out of money then who will be there to bail out an “evil and now mismanaged” insurance carrier. Answer…NO ONE.

So, do not be fooled by the daily flow of news flashes coming across your email that paint a picture which makes the carriers look like they are being excessive. Also, just as in 2009, when the infamous Anthem increase of 39% pushed HCR forward, the news flashes are spotlighting carrier request for their individual products not group. The ACA restrictions on individual plans are the scariest to price because of  what I said above regarding mandated benefits and people not forced to buy.

Group products will certainly see increases because the regulations and restrictions coming in 2014 force it but the media is trying to fool the American public into thinking the double digit increases about which it is reporting also pertain to group.

Don’t be fooled and don’t miss an opportunity to challenge what you read.

Finally, if given the slightest chance, we should defend the  american health insurance companies which are being forced to do what no other industry in the world is forced to do.

The ACA is real and it is going to be implemented. But, that does not mean that the battle to do what is right is over. Don’t give up and don’t give in!

Thanks for listening.

Mark Reynolds, RHU

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