Stop Rubber-Stamping Health Insurance Hikes Say Activists
Albany, NY - Lawmakers in Albany were to hear today from frustrated consumer advocates who say health insurance premiums have more than doubled since the rate hike approval process was streamlined in 2000. They want more regulatory authority restored to the state's Insurance Department.
One New Yorker, Jim Shea, who would like to testify before the hearing in the Assembly's Insurance Committee, is too weak to travel. Up until nine years ago, Shea, who lives in Brooklyn and is HIV-positive, used to testify at hearings in New York City when the insurance industry wanted to raise his premiums. The hearings stopped in 2000 when the process of rate hike approval was streamlined, so Shea now has little say over what he's charged for the private plan that supplements his Medicare.
"The insurance is only paying for my drugs and 20 percent of my other medical costs, and yet they're charging me $893 dollars a month for my health insurance."
And it's going up yearly. The Health Care for All New Yorkers coalition will tell Assembly members how premiums have skyrocketed since 2000, when the change allowed companies to file for an increase and put it into effect without prior approval from the state, a procedure known as "file and use."
Heidi Siegfried, health policy director for the Center for Independence of the Disabled NY, says that before that came into effect, citizen input was part of the process.
"There were public hearings that were held so that more than just the Insurance Department could scrutinize the claims that the health insurance industry was making. You know - their books were open!"
The legislation proposed by Governor David Paterson wouldn't reinstate the hearings, but would give the Insurance Department back its prior-approval authority. Siegfried says that from 1996 to 1999, annual health insurance premium rate increases averaged 7.5 percent. From 2000 to 2006, after prior approval was replaced by "file and use," rates went up an average of 15.9 percent.
"Some just people think it's too complicated an issue to understand. So, we're trying to simplify it and just say, 'We can't deal with these increases and we should be able to scrutinize the health insurance companies.'"
Jim Shea says every year the cost of his private health insurance goes up by about 100 dollars. The burden, he says, is almost too much to bear.
"It's more than my housing. I no longer have a car. I don't take vacations. I mean, it's the most expensive expenditure I have and it's spinning out of control, and I have no choice but to pay it."
The insurance industry says the proposed change will amount to arbitrary price controls.