WellPoint's subsidiaries backed off of the 39% increases on individual policies they were threatening in California. So they're making up for the lost revenues, along with several other major insurers in the state, but jacking up rates for small businesses.
Five major insurers in California's small-business market are raising rates 12% to 23% for firms with fewer than 50 employees, according to a survey by The Times.
Similar increases are being felt by many small businesses across the nation, including those in Texas, Ohio and Florida — mainly the result of escalating costs for medical care and pharmaceuticals, insurers say.
In California, some small businesses say they are stunned by their latest insurance bills. Longtime customers of Blue Shield of California, for instance, are facing rate hikes as high as 76% after the insurer lost money on a handful of plans....
Economists and small-business advocates worry that insurance costs — on top of taxes and rising wages —- will hamper the ability of small firms to expand and scare away new small companies. Analysts point out that small businesses are responsible for creating most new jobs in California and are key to its economic recovery.
Many small business owners are going to have to continue make hard choices about either staying in business, or dropping coverage for their employees altogether between now and when the exchanges are created in 2014. That'll force more people into the expensive individual market or into the still existing and too big ranks of the uninsured for the next few years.
We still need a public option. And we still need both the anti-trust exemption repeal and the HHS rate review authority. Leahy had an anti-trust exemption repeal amendment ready to be offered in financial reform, but it didn't get a vote. Feinstein's rate review authority is still out there, waiting for a vehicle to be attached to. Given the economic impact these rate increases could bring, the jobs bill might just be that vehicle.
(H/T Chris in Paris)
