Yesterday, the State of California wagged its finger at Anthem Blue Cross for raising health insurance rates for 120,000 of its policy holders an average of 16%. Shouting "Down! Down! Bad Dog! Bad Anthem!" officials then conceded they had no power to do anything about the rate hikes except reverse roles, turn over onto their bellies and hope that Anthem didn't kick them too hard.
A California regulator for the first time has declared a health insurance rate increase "unreasonable" but acknowledged that it can do nothing to stop the state's largest for-profit insurer from going ahead with it...
As a result, rates for 120,000 customers of Anthem Blue Cross will begin rising an average of 16% on Sunday...
...the managed healthcare department, an arm of the governor's office, came under attack itself from consumer advocates for failing to win concessions, even as the department publicly scolded Anthem for going ahead with its plans...
"In the spirit of providing maximum transparency to consumers about rate increases, we have little choice but to publicly express our disappointment that Anthem Blue Cross didn't lower the rates as we requested."
A declaration of 'unreasonableness! A public scolding! A public expression of disappointment! What will they think of next? Perhaps they can write a sternly worded letter. That will surely make Anthem and other insurance executives quail in their jacuzzies as they are enjoying their multi-million dollar bonuses for extracting yet another pound of flesh $11 billion in profits in 2010 from their customers.
California, besides having a legislature that is completely useless, has a health insurance regulatory structure that is beyond impotent. Basically, it has no authority to regulate rates -- even though 35 other states had given regulators some authority to reject unreasonable rate hikes.
Not only is it impotent, but it is also divided into two: parts of the state's health insurance industry are regulated by the State Insurance Commissioner (well, duh!), while parts of it are regulated by the California Department of Managed Care (huh, what?). These latest rate increases announced by Anthem fall under the purview of the latter.
Legislation has been introduced yet again in California's legislature to give the Insurance Commissioner authority to reject unreasonable health insurance premium rate increases -- AB 52 by Los Angeles Democrat Mike Feuer. It has failed in previous legislative sessions. And it will likely fail again, because if there is one thing we can be sure of, very profitable health insurance companies like Anthem have their hooks oh so deep into more than enough members of the California Legislature.
They will stop at nothing to derail any regulatory legislation, just as they will stop at nothing to sabotage single-payer health insurance reform in California.
Getting rid of these bloodsuckers will not be easy; yet it must be done if there is to be any hope for the future of health care in the United States. Meanwhile, another 120,000 Californians will be witnessing the result of the dog as master.