April Fools

empty wallet Attention individual payers — starting on April 1st many of you will have more disposable income.  Blue Cross Blue Shield of Rhode Island is requesting an increase in premium rates for the Direct Pay Class (natch) and many of you will be forced to drop out completely.  In a way, this means more money in your pocket.  Just don’t get sick. This particular group is the usual target of rate hikes for the obvious reason that BCBS will not have to face any organized opposition.  Hearings were held on January 14th and 15th and according to a report on Channel 10 News, there were two witnesses speaking out in opposition. That’s okay, we have the Rhode Island Office of the Health Insurance Commissioner (OHIC) watching our backs.  What exactly is the mandate of this agency (just formed in 2004)? I went to their website to find out more information on the next public hearing scheduled for January 22nd and could find no mention of it. The site looks somewhat abandoned and if the Governor hasn’t closed down this office by now, he has my permission to do so.  The mission statement is vague and squishy. It is clear that they have no teeth and no intention of working outside the for-profit insurance model of health care (and may indeed hope to work inside it after retiring… with a state pension).  Here is what they have to say under ‘Consumers; Controlling Premiums’

Rising health insurance premiums are major concern nationally and Rhode Island is no exception. Among the factors driving health insurance premiums, none is more significant than medical costs.

Approximately 79-89 cents of every fully insured commercial premium dollar goes towards paying medical claims submitted to a Rhode Island insurer by a service provider.

No mention is made of the other factor driving costs — the remaining 21% of your premium dollar spent on administrative costs — a number that shocks the rest of the industrialized world.  Froma Harrop has some interesting thoughts on really overhauling this unsustainable mess. In the meantime, I think the people of Rhode Island can survive without the OHIC.  Whoever used to do, whatever it is they do do, can do it again.

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