States that require no-fault auto insurance pay highest premiums

By Theo Emery, Associated Press



March 31, 2005





BOSTON - States like Massachusetts that require no-fault auto insurance have some of the nation's highest premiums, and should change their laws to require insurers of at-fault drivers to pay for accidents, according to a report released in Boston on Tuesday.



"The bottom line is that no-fault is a bonanza for insurance companies. It's a disaster for consumers," said Harvey Rosenfield, an attorney with the nonprofit consumer group sponsoring the report, the California-based Foundation for Taxpayer and Consumer Rights.



Most states have standard liability insurance, or what the report called "personal responsibility insurance," in which insurers of drivers found to be at fault in accidents must pay costs for the innocent parties.



Nine states, including Massachusetts, now have mandatory no-fault insurance. The law requires drivers to be compensated by their own insurer, regardless of who caused the accident. During the time covered by the report, there were 10 states with no-fault insurance; Colorado dropped its mandatory no-fault policy in 2003.



Premiums in states with no-fault insurance are 19 percent higher on average than in states with personal responsibility insurance, according to the report. The report also found that rates went up on average 9.8 percent between 1998 and 2002, compared with 5.1 percent in states with personal responsibility insurance.



Massachusetts rates in 2002 averaged $624, making it the third highest in the country. New York, which also has no-fault, had the highest average auto insurance of $741, and New Jersey, which has a mix of no-fault and liability, averaged $659, according to the report.



Rosenfield acknowledged that no-fault insurance is not the sole factor behind rates. Rhode Island, for example, has standard liability insurance with average rates of $610, the fourth highest in the country, while Connecticut was the sixth highest rates of $600.



The report also found that rates fell when states abolished mandatory no-fault insurance, and also recommended stringent industry regulation.



Daniel J. Johnston, president of the Automobile Insurers Bureau of Massachusetts, said there's no consensus that no-fault insurance causes high rates.



"The devil is in the details. What really matters is what you've got in its place when it's gone," he said.



Chris Goetchus, spokesman for the state Division of Insurance, said a task force convened by Gov. Mitt Romney in April is looking at reforming auto insurance in the state, including the state's mandatory no-fault insurance. Fraud is a major focus of its work, he said.



"Nothing's off the table. They're looking at all aspects of the no-fault law, with an eye to reducing unnecessary costs," he said.



Massachusetts, the only state where auto insurance rates are set by state regulators, was the nation's first state to adopt no-fault insurance, in 1971. Six states and the District of Columbia have repealed their mandatory no-fault insurance laws since 1980, according to the report.

Insurance commissioner to host hearing on auto rates

State Insurance Commissioner Jim Long will conduct a hearing in September to discuss auto-insurance rates.



The move comes after the NC Rate Bureau filed for an 11.5 percent increase in rates in early February.



Long's agency denied the request, triggering a state law requiring that a hearing be held.



Auto-rate hearings typically encompass three to four weeks of testimony from both sides.



At the conclusion of such hearings, Commissioner Long will decide what rate change, if any, is warranted. The NC Rate Bureau then has the right to appeal through the court system.

N.H. House repeals parts of health insurance law

CONCORD — The House voted Wednesday to repeal pieces of a controversial health insurance rating law it supported two years ago, joining the Senate in proposing major changes to rate-setting rules.



By an overwhelming vote of 256-105, the House sent a measure (HB 611) to the Senate which would undo many provisions of the small business insurance rating law known as Senate Bill 110. The law, which took effect last year, allows insurance companies to factor in age, medical history, type of business and geography when calculating rates. The House bill passed Wednesday eliminates most of those factors when insurance companies set rates for small businesses.



The Senate passed a similar measure last week.



“This will bring stability to a market that is in flux due to the chaos Senate Bill 110 has created,” said Rep. Sheila Francoeur, R-Hampton. “This is the first positive step to correcting the errors of Senate Bill 110. It moves us along to health care reform, something that is needed in this state.”



There was vocal opposition to the bill, even though the vote was lopsided. “I don’t think we’ve given this enough time,” said Rep. Michael Whalley, R-Alton, a small business owner. “I don’t think it’s the appropriate thing to slam the door here today and slam the door on something we did just a year ago.”



The bill eliminates the location of a business and health status of workers in setting insurance rates. Because geography is a factor in setting rate, the Seacoast and North Country were the two hardest hit areas as a result of SB 110. Age and type of business will remain in the rate setting.



It also sets up a reinsurance pool for high-risk policies. The insurance companies would be assessed a $1 per month, per person fee to create the funds for the risk pool.



The reinsurance pool would allow insurance companies to shift high-risk employees into the pool after the rates have been set.



Opponents claimed insurance companies will pass the $1 reinsurance pool fee to the ratepayer.



“(This bill) creates a $1 per employee per month business tax for every small business in this state. It will raise rates between 30 and 60 percent,” Rep. Rogers Johnson, R-Stratham. “(This bill) takes every onerous aspect of Senate Bill 110 and makes them worse, in fact it super-sizes them. A year from now you’re going to have to explain to your constituents as to why their rates are so high. If you want to pass this business tax, then OK.”



Gov. John Lynch said throughout his campaign he would fight to repeal SB 110. On Wednesday, Lynch praised House members for passing a major overhaul of the law regarding small businesses, defined as having 1 to 50 employees.



“By taking action to repeal the onerous provisions of SB 110, the Legislature has shown that they have heard the cries of our small businesses,” Lynch said. “I look forward to working with Democrats and Republicans in the House and Senate to make sure our small businesses get the relief they need.”

AIG Chairman Greenberg's Retirement Letter

The letter from Greenber's attorney follows:





March 28, 2005



Richard Beattie

Simpson Thatcher & Bartlett LLP 425 Lexington Avenue

New York, New York 10017



Dear Dick:



As you are aware, Hank Greenberg is out of the country on a two

week trip to Asia and Europe. In his absence, he has asked me to

convey to the AIG Board of Directors his intention to retire as

Chairman of the company upon his return to the United States and

not to stand for re-election to the AIG Board following the

completion of his present term as a Director.



Over the last 35 years, Mr. Greenberg has had the opportunity to

lead AIG through its greatest years of growth and development.

When AIG first became a public company, it had net income in the

tens of millions of dollars. Now it is in the tens of billions of

dollars. The company is stronger by every measure, financial and

non-financial. But even with all the changes we've seen in the

past, the industry today is going through even more profound

changes. It is doing so at an increased pace, moving towards

greater levels of complexity.



Mr. Greenberg's objective has been, and is, for AIG to be in the

vanguard of these changes. In order to lead meaningful changes in

the industry and at AIG, the company and its officers and

directors must resolve any outstanding questions or issues and

move forward. To that end, Mr. Greenberg recognizes the need to

promptly and cooperatively resolve all inquiries and

investigations by regulators and other authorities.



Mr. Greenberg's intention has always been to leave AIG as part of

an orderly succession process that recognizes and taps the great

talent in this organization, and he believes that it is in the

interest of the company and its shareholders that, with the

transition to new management now in place, a new Chairman be

selected who will guide AIG's growth and success over the next

decades.



Mr. Greenberg has also asked me to convey to the Board one

concern, one recommendation, and one offer. The concern is that it

is not in the interests of the company or its shareholders to have

members of the Board or their representatives prematurely and

selectively leaking to the press (sometimes accurately and

sometimes inaccurately) what has been discussed and proposed at

meetings of members of the Board without the press release and SEC

filing required to accurately convey material information to the

entire market.



The recommendation is that a search be initiated immediately to

identify a person with the extensive international financial and

insurance experience required to serve as Chairman. Mr. Greenberg

believes that it is important to the company and its shareholders

that the uncertainty created by current regulatory issues and the

repeated leaks of discussions among members of the Board be

resolved promptly. In that connection, he believes that it is

important to as promptly as possible select someone as Chairman

who is capable of participating in providing AIG with strong and

effective leadership over the long term. As you know, Mr.

Greenberg has great affection and admiration for the current

members of the AIG Board, and he believes that they, like him,

must put the interests of AIG and its shareholders above any

personal interests.



The offer is to assist AIG in whatever way, if any, the new

Chairman and Mr. Sullivan believes is in AIG's interests,

particularly in connection with international operations where Mr.

Greenberg has unique experience and relationships.



AIG is a great company, and Mr. Greenberg retires with the

greatest of confidence in the ability and integrity of its 93,000

employees, the strength of its fundamentals, and its ability to

master future challenges.



I am, of course, writing to you as counsel to the Board rather

than to the members of the Board personally because of the limits

on my ability to communicate directly with your clients. I know

that you will convey Mr. Greenberg's thoughts to them. Thank you

again for your thoughtful cooperation.



Sincerely yours,



David Boies

Small Employer Insurance Bill Offering Pared-Down Health Plans

March 30, 2005



Ga. Senate Bill 174, allowing small companies to offer employees pared-down health plans that do not comply with all state-mandated insurance requirements has been approved by the House of Representatives. The Senate passed a different version of the bill on March 10, so it now goes back to the Senate for final approval.



The bill, estimated to save 10 to 15 percent on health insurance costs for small businesses and their employees will:



∙ Give small businesses a break in paying for their employees' health insurance;



∙ Make health insurance more affordable for small businesses; and



∙ Encourage more small businesses to offer health insurance to their employees.



The original version of SB 174 eliminated coverage from some preventative screenings, but most of those measures were restored in amended versions of the bill.



SB 174 will give employees a choice between a traditional plan, with full coverage under the existing state mandates; or a new plan offering less benefits at a lower cost. State regulations only apply to employers with less than 50 employees and large self-insured employers are exempt from the regulations. It will allow insurance plans to stop covering specialties, such as psychology and acupuncture, while requiring a physician referral to see a dermatologist.

Plan would require all Minnesotans to buy health insurance

Every Minnesotan would have to buy at least basic health insurance by January 2007, and health plans would have to offer it at a price that couldn't vary based on a person's age, gender, health history or status, two lawmakers proposed Tuesday.



Their bill, based largely on recommendations from the Minnesota Medical Association, doesn't say what the essential package would cover, what it would cost or how the costs might be subsidized.



Still, its authors, Anoka Republican Rep. Jim Abeler and Sen. Sheila Kiscaden, an Independence Party member from Rochester, said the plan would provide all Minnesotans with affordable insurance and boost the quality of care while holding down costs.



The "Physicians Plan for a Healthy Minnesota" also calls for increasing the cigarette tax by $1 a pack. The money would help pay for Minnesota-Care, a state-subsidized health-insurance program for low-income Minnesotans, which would still be available.



Under the MMA plan, everyone would pay the same premium for the most basic medical benefits because risk would be spread statewide, but individuals could pay more to upgrade, Kiscaden said.



The measure would require the state Health Commissioner to come up with a plan by the end of this year to enforce the requirement.



Minnesotans are already among the best-insured in the nation. Surveys by the Minnesota Department of Health and other organizations estimate 6.7 percent -- about 343,000 Minnesotans -- were uninsured last year. But that's worse than 2001, when about 266,000, or 5.4 percent, were without health insurance. State business and political leaders say health-care costs of the uninsured are eating away at their budgets.



"We do have one of the healthiest states and do have one of the highest rates of people with health insurance. However, we are having more and more people who do not have health insurance" largely because some employers are dropping coverage and MinnesotaCare has tightened eligibility requirements, said Dr. Judith Shank, a Wayzata dermatologist and chairwoman of the Minnesota Medical Association's health-care reform task force, whose recommendation formed the basis of the bill.



While no cost estimates were available, the physicians' group assumes that in the long run, the plan will save money.



The proposal is the first of its kind in the United States, said Roger Feldman, a health-care economist at the University of Minnesota.



"We're breaking new ground, although the thing it's most similar to is auto insurance. We have a law that says if you want to drive a car, you have to have insurance. Without those laws a lot fewer people would have auto insurance. We decided that it's really important to do that," said Feldman, who supports the general idea of mandatory health insurance.



"The notion of everyone having some sort of coverage with a basic benefit set is something we really endorse," said Julie Brunner, executive director of the Minnesota Council of Health Plans, a group that represents Minnesota's major health plans.

Online auto insurance firm adds Wisconsin

San Francisco-based online auto insurance specialist Esurance Inc. is rolling out a TV ad campaign in markets across the country as the Internet company's rapid growth rate continues. Esurance, which sells its policies in 17 states, plans to start marketing in five new ones this year, beginning in New Jersey by month-end, and followed by Indiana, Minnesota, Tennessee and Wisconsin.


California accounts for about 25 percent of Esurance's business, and Florida 24 percent, with Texas in the third slot.
About 80 percent of Esurance's business comes to it directly, either online or over the phone, including a click feature on its www.esurance.com web site that lets potential customers connect by phone to a sales representative.
The company's revenue has exploded from $3.5 million five years ago to $201 million last year, jumping 73 percent in 2004 alone. It hopes to nearly double its policyholder ranks this year, from 140,000 currently to as many as 250,000 by year-end, according to Gary Tolman, Esurance's president and CEO.
Esurance has claims offices in Sacramento, Dallas and Tampa, and plans to open sites this year in Atlanta and Phoenix.
Esurance posted its first profit ever last year, a small but significant $3.8 million. In contrast, it lost $18.5 million in 2003 and $25.1 million in 2002.

UM health insurance benefits extended to same-sex couples

Rafael Chacon, a University of Montana art professor, always used to say he earned less than his straight colleagues.
It wasn’t that he had a smaller salary, but he and his partner paid for his partner’s health insurance out of their pockets and through a private insurance agency.
Chacon’s partner wasn’t eligible for UM’s employee insurance plan. Instead, he paid about $4,000 a year for his own health insurance.
“For me, it’s always been a case of discrimination,” Chacon said.
Chacon and his partner were not eligible for UM’s benefits because couples had to sign an affidavit saying they were married, at least by common law, in order to receive them. In Montana, gay couples cannot get married, and Chacon and his partner were not eligible to sign the agreements.
However, the Board of Regents unanimously voted earlier this month to extend health benefits to one adult dependent for each employee covered by the University. The vote extended health insurance benefits, in theory, to same-sex couples.
The new policy will go into effect July 1.
The dependent would have to meet certain criteria, which the board left for Sheila Stearns, the commissioner of higher education, to determine.
The criteria will probably consist of rules such as employees would have to have lived with their dependents for at least one year, have joint ownership of a home or vehicle, financially support each other or have some sort of power of attorney over the other person, said Glen Leavitt, director of benefits for the Montana University System.
Candidates will probably have to meet a certain number of the criteria to obtain benefits, he said. The final decision will be left to Stearns and her office.
Chacon is somewhat concerned about the standards, but he is doubtful that it will pose too much of a problem for him and his partner, as they have a long-term relationship and share bills and accounts.
“Obviously we were pleased with the outcome,” Chacon said. “I think it’s a very good step.”
As with married couples, the employee will pay about $150 a month for the additional dependent. The Montana University System does not pay for the extra coverage.
“I don’t think the opposition on this ever had much of an argument,” Chacon said.
About 50 people came to the Board of Regents meeting to show their opposition to the proposal.
The Board of Regents didn’t care what the taxpayers had to say, said
Gloria Hardin, a Bozeman resident who spoke against the new policy.
“I felt like they had their minds made up before we went in there,” she said.
Hardin said she was not swayed by the regents’ argument that allowing more people into the insurance plan would spread out the cost and benefit everyone.
“I was not for it, so I still feel the same about it,” Hardin said.
The policy change stemmed from an ongoing discussion that began nearly three years ago.
Two UM employees filed a lawsuit in 2002, claiming the University was discriminating against them by not offering health insurance to their same-sex partners.
Historically, the University system has provided health benefits for non-married, heterosexual couples at the employee’s expense if the couple signed an affidavit of common-law marriage.
In December 2004, the Montana Supreme Court ruled in a 4-3 decision that gay and lesbian partners of University system employees have the same right to health insurance benefits as heterosexual partners.
“It’s a huge victory for a positive movement for more rights for same-sex couples,” said Lambda Alliance member Bryce Bennett. “It’s long overdue.”
The board dealt with the issue very well, he said. The board could have chosen to just wipe out all non-married benefits rather than extending rights to same-sex couples.

Women Dominate Auto Insurance, Safety, Registration Web Sites

NEW YORK --(Business Wire)-- March 28, 2005 -- Automotive Web sites often are thought of as a man's domain, but women are the majority to several sites delivering information about automotive finance, registration and vehicle insurance.



According to Hitwise, the world's leading online competitive intelligence service, women comprised 40 percent of visits to automotive Web sites for the four weeks ending March 19, 2005. While they are slightly underrepresented in the overall auto category, women are far more likely to visit sites like AmeriCredit (www.americredit.com), AAA (www.aaa.com), NASCAR Store (store.nascar.com), Department of Motor Vehicles Guide (www.dmv.org), and Esurance (www.esurance.com).

Assurant Health overbilled small firms

Assurant Health overcharged an unspecified number of small businesses between 2002 and 2004 and will have to pay refunds to those clients, state regulators determined in an investigation of the Milwaukee-based insurance company.



The Wisconsin Office of the Commissioner of Insurance found that Assurant miscalculated rates for small employer customers and must refund each small employer group the amount it was overbilled.



It's not yet clear how many of Assurant's small employer customers, those with between two and 50 employees, had to pay higher health insurance premiums because of the miscalculations, or how far back the miscalculations stretch.



The insurance commissioner's investigation of the company -- then known as Fortis Health Insurance Co. -- pointed out potential overbillings based on a sampling of 2002 and 2003 policies. Fortis changed its name to Assurant Health in 2004.



The amount that was overbilled will be better known by early June, when Assurant must report a more detailed account of the errors to state regulators, said Susan Ezalarab, director of the insurance commissioner's Bureau of Market Regulations. Ezalarab declined to estimate how many customers were affected, or how large Assurant's reimbursement to those clients might be.



Phone calls to company officials were not returned. In a March 23 statement, the company said it is "committed to complying with all applicable Wisconsin regulations."



Millions in premiums

The company wrote more than $24 million in small group insurance premiums in 2002 in Wisconsin, according to the insurance commissioner. It wrote another $19 million in individual premiums that year, and is considered one of the larger writers nationally of health insurance policies for individuals.



Questions about overbilling arose during a state investigation of Fortis after an unusually high number of complaints were filed against the insurer in 2002 and 2003.



Investigators found that Fortis erroneously used occupation as a factor in determining small group insurance rates. State law bars insurers from considering occupation in determining those rates, although factors including age, sex and health of the group can be considered. Excluding certain factors in setting rates helps ensure more common rates and smaller rate swings for small businesses, state regulators said.



The insurance commissioner occasionally conducts "market examinations" of all insurance companies operating in Wisconsin, Ezalarab said.



State insurance regulators logged 211 complaints against Fortis between Jan. 1, 2002, and Dec. 31, 2003, according to the report.



That included 73 complaints about individual accident and health coverage in 2003 alone, or 0.38 complaints per $100,000 of written premium -- more than five times the state average of 0.07. It was the highest "complaint ratio" among individual accident and health insurers in the state during that time.



The majority of the complaints involved "claim handling issues" such as claim denials, according to the investigation. Sixty-seven complaints involved the insurer's preferred provider organization business.



The investigation report includes 45 recommendations that Assurant must follow to comply with state law. Many are minor recommendations, ranging from maintaining a more accurate database of agents to revising a brochure it gives to employer customers.



Violations a concern

The breadth of state law violations, however, was concerning, Ezalarab said.



She said there is a general "pattern" of Assurant not following Wisconsin insurance rules, and that the insurer "does not seem to have policies or procedures in place" to do so adequately.



She said Assurant's lack of compliance with state-specific rules is especially concerning given that the insurer is based in Wisconsin.



In the report, regulators ordered Assurant to devise a "compliance plan" and conduct regular audits to make sure state laws are being followed.



"They need to get a better handle on compliance," Ezalarab said.



Ezalarab said Assurant is working to increase the amount of staff dedicated to compliance issues.



She called the small employer rate miscalculation "a technical issue" and said the company told investigators that it happened following installation of a new rating software system that wrongly built occupation into the formula used to determine small group premiums.



The company is working to fix the problem, Ezalarab said.



Insurer taking action

In a letter to the insurance commissioner dated March 3, an Assurant Health official said the company would not contest the regulators' report or any of its recommendations.



Assurant "has begun remedial action for the matters identified in the report that required correction and/or better documentation to demonstrate compliance," wrote Betsy Pelovitz, director of market conduct for Assurant. "The company is committed to complying with all applicable Wisconsin laws and regulations" and will follow up with a corrective action plan by mid-May, she wrote.



Pelovitz did not return phone calls seeking additional comment.



The state will likely continue to track Assurant's progress in correcting the violations. Fines are possible if the company fails to comply, Ezalarab said.



The number of complaints surprised Jon Cyganiak, an agent with Cyganiak Planning Inc., a Brookfield agency that sells Assurant products primarily to individuals.



"I haven't had any issues with them on the individual side," he said.



Assurant has traditionally been known to charge higher premiums for its small group insurance products, Cyganiak said. Large-scale small employer rate miscalculations are rare, he said.



Assurant Health is one of four operating divisions of Assurant Inc., which comprises the U.S. insurance operations that European financial conglomerate Fortis Inc. spun off as a publicly traded company in an initial public offering in February 2004. Assurant Health's headquarters is at 501 W. Michigan St., Milwaukee.

Fair Care a needed health insurance break

By Dr. Manuel Figueroa



ONE of the many forms discrimination takes is in the Tax Code and those victimized by it are the people who have to purchase their own health insurance. In 2004, employer-provided and self-employed health insurance received a $155 billion tax break, but people who purchased their own health insurance received no tax break.

This problem is reaching alarming proportions as, according to the U.S. Census, the percentage of the work force covered by employer-provided insurance dropped to a new low of just 60 percent. It should go without saying that people who are forced to purchase their own health insurance shouldn't be discriminated against, but it will take an act of Congress to fix the problem.



Those of us in the Latino community feel the gravity of this discrimination even deeper, as one out of every three Latinos is uninsured, again according to the most recent U.S. Census figures. We either know someone who is uninsured, or we are uninsured ourselves.



Many in our community could be forgiven for thinking an act of Congress is a hopeless pipe- dream. But there is hope in a bill that has wide bipartisan support.



In the past few weeks with leadership and support from President Bush, Republicans and Democrats reintroduced a bill that would provide $1,000 annually to uninsured individuals, $2,000 annually to uninsured couples, and $3,000 annually to uninsured families to buy private health insurance.



This bill garnered more than 130 co-sponsors in the House of Representatives last year, ranging from conservative Republicans to liberal Democrats including several members of the Congressional Black Caucus and the Congressional Hispanic Caucus.



The bill is called "Fair Care for the Uninsured,' and it will correct the discrimination built into the tax code that has treated differently individuals who buy their own policies. The money provided under Fair Care would be advanced to workers up front so that they could have money to buy health insurance, and, according to a study done by Fiscal Associates, 18.6 million uninsured people could buy health insurance half of the total number of uninsured people in America today.



Some politicians would like to consign a large number of America's working poor to Medicaid, or some expanded version of Medicaid, the health- care program for poor Americans. Fair Care is a superior alternative because it allows people to shop for the health-care plan that meets their family's needs. It would neither bust the federal budget nor continue to choke state budgets across the country.



As a doctor in Los Angeles, I can see firsthand how much this bill would improve our country's health-care system. As a Latino-American, I can see how this would help assimilate Latino-Americans and protect them against hospitals that charge uninsured Latinos three to five times what they charge insured patients. That's why 81 percent of Latinos support this legislation and would vote for a member of Congress who supported it as well.



Fair Care would change the tax treatment of health insurance and give low-income working families without health insurance money to help them purchase private health insurance best suited for their families. The discrimination against millions of workers many of them minorities would be eliminated and millions of people would come off the uninsured rolls. Manuel Figueroa is a physician who practices family medicine in Los Angeles.

Committee considering publicly financed health insurance

MONTPELIER, Vt. -- A plan is being developed in a House committee that would establish a publicly financed health insurance system covering every resident of the state and funded by payroll or income taxes.



Although it would be significantly different, the plan would be similar to the single payer system that exists in Canada and many European nations.



The House Health Care Committee began reviewing the first draft of a bill Friday that would set the state on the path toward a system that provides health care to every citizen of the state. The plan would be overseen by a state board that would recommend to the Legislature and the governor what benefits would be covered and how much it would cost.



"We're striving for an integrated system of care," said Health Care Committee Chairman John Tracy, D-Burlington.



Gov. James Douglas immediately dismissed the proposal, saying it would lead to health care rationing and too much government bureaucracy.



"It's moving in exactly the wrong direction," Douglas said. "Vermonters don't want to stand in line and wait for a number for their health care."



Under the plan being developed in his committee, Tracy said, the new system could be in place as early as 2007. Primary care would be covered beginning June 30, 2007, and hospital care would come under the new system three months later.



A state board would oversee the entire health insurance system and there would be regional boards centered around the state's existing community hospitals to help run it.



The goal is to have a comprehensive universal system, although there would be the opportunity for people to buy private insurance for all of their coverage or to cover elective procedurs.



The key difference between the system currently being contemplated and the single payer system is that no one would be forced into the state plan, although they would have to help pay for it through taxes.



Tracy said he believed the taxes would be an incentive for employers and residents to drop private coverage and enroll in the new public system.



"We're (already) spending the money. We're trying to spend it more efficiently," Tracy said. The goal would be to raise in taxes only enough money to replace what people currently are paying for insurance. "It should be dollar for dollar on your premium," he said.



House leaders have been pushing for reforms to the health care system since they took office in January. But up until now, the belief around the Statehouse was that whatever would be pursued this year would be much less aggressive. The Health Care Committee decided, though, that incremental reforms might not make much difference and might actually introduce new problems.



The committee has not voted on the draft bill before it or the specific direction it is taking, but it incorporates many of the concepts that have been discussed. There are likely to be many changes before a final draft is voted on, but Tracy said it was time to get started on a bill.



"We needed to put something on paper," Tracy said.



Douglas said he would urge legislators to consider his proposal, which would adopt reform much more slowly, expanding insurance coverage to 20 percent of the estimated 64,000 people who don't now have coverage. He said he was confident that the House would understand that the draft it is now considering cannot be achieved.



"This idea has a long way to go, obviously," he said.

Reservists to keep military health insurance

Plan gives members coverage for as long as 8 years



The Associated Press



WASHINGTON - The more than 400,000 National Guard and Reserve members mobilized since September 2001 for the fight against terrorism will be offered the choice of military health care coverage for as long as eight years after they return to civilian life.



Only those who remain in the Reserves after they are demobilized will be eligible, said Thomas Hall, the assistant secretary of defense for reserve affairs.



Hall said that in discussing the plan with more than 2,000 Guard and Reserve members in the Persian Gulf recently he heard a great deal of enthusiasm for this kind of transitional health insurance.



“It targets the young men and women bearing the brunt today,” Hall said.



Until now, Guard and Reserve members could retain health care coverage under the Defense Department’s Tricare system for no more than six months after they left active duty. Under the new arrangement they could retain coverage for at least one year and as long as eight years, depending on the length of their mobilization and the length of their commitment to remain in the Guard or Reserve.



They would pay monthly premiums ranging from $50 to $150 a month for individual coverage, depending on their rank, and from $100 to $300 a month for family coverage, depending on rank.



William Winkenwerder, the assistant secretary of defense for health affairs, said at a joint news conference with Hall that he has no firm estimate of how much the program will cost the government.



Later, the Pentagon issued a statement saying the cost would be $70 million for the remainder of the current budget year, which ends Sept. 30, and $394 million for the 2006 budget year.



Hall said he expects a majority of eligible Guard and Reserve members to resume coverage under the health care system offered by their civilian employer, rather than take the military coverage.



Winkenwerder said the Pentagon has no firm forecast of how many people will take the benefit. “It’s going to be many thousand to tens of thousands, we would expect, at a minimum,” he said.

More Auto Insurance Choices for NJ

TRENTON, N.J. -- New Jersey drivers are about to get more choices when it comes to selecting an auto insurance company.



Progressive Insurance, the nation's third largest, will enter the state market sometime this year, along with Esurance Insurance Co., an online insurer that will begin offering private passenger auto policies Tuesday, according to the second annual auto insurance report released Tuesday by the Department of Banking and Insurance.



"Auto insurance has always been the number one issue or had been for some time the number one consumer issue," said Jaimee Gilmartin, spokeswoman for the department.



In 2003, the state instituted an auto insurance reform after more than 40 insurance carriers left the state during the past decade and other major carriers were threatened to leave an over-regulated market.



Some $3.5 million has been returned to 2 million drivers through dividends or rate reductions since the reform began, according to the report.



Other milestones include Geico returning to New Jersey last year after a 30-year absence and the return of Safeco.

Tax experts push for overhaul of health insurance tax benefits

The more than $150 billion spent on health insurance tax benefits does more harm than good, witnesses told a presidential panel studying tax reforms.



"It is such a bad subsidy. It's increasing the number of uninsured," said Eugene Steuerle, senior fellow at the Urban Institute. "It's one of the worst subsidies that we could possibly imagine."



Steuerle and Mark Pauly, a health care economics professor at the University of Pennsylvania, argued that tax breaks given to employers and employees for health insurance don't promote the spread of basic health insurance coverage.



Instead, the incentives cause people to buy excessive amounts of insurance to lower their taxes. That means costs increase, causing some employers to drop their health insurance coverage altogether.



Pauly said the incentives are "mistargeted." They lower taxes most for higher wage earners and increase the ranks of the uninsured.



"By most definitions of fairness, the patterns of distribution of these differences in their taxes would be regarded as highly unfair and inequitable," he said.



The panel's vice chairman, former Louisiana Sen. John Breaux, asked the experts for more information about the best ways to use tax laws to increase health insurance coverage among those who have none.



"It's the biggest problem, I think, in the country," Breaux said, also calling it "much more difficult that Social Security."



Census Bureau data show that about 45 million people lacked health insurance at some time during 2003.



The President's Advisory Panel on Federal Tax Reform plans to issue a report this summer with options to make the nation's tax laws fairer and simpler.



The panel explored the notions of fairness at its meeting Wednesday, probing not only health insurance but also benefits for low-wage workers, tax penalties for married couples and subsidies embedded in the tax system.



Steuerle estimated the subsidies for health insurance stand at $150 billion, projected to grow to $250 billion in several years.



Pauly calculated that those subsidies amount to more than $188 billion. They include tax breaks for employer provided health care, cafeteria plans, flexible spending plans and new health savings accounts.



Taxpayers can also take a deduction if they pay more than 7.5 percent of their income in a year for medical costs not reimbursed by insurance.



The result is that "the richest half get 75 percent of the subsidy. The poorest half make up 75 percent of the uninsured," Pauly said.



He pointed to his own Calvin Klein glasses, purchased with money set aside in a tax-free flexible spending account, as evidence of tax benefits accruing to those with the best coverage.



"I'm grateful to the U.S. Treasury for improving my appearance, but I would not put that high on the list of social priorities," he said.



Pauly recommended that the tax subsidies for health insurance coverage be limited and combined with a new refundable credit to help low-income and uninsured individuals and families buy coverage.



Steuerle warned that the country's mounting deficits and aging population could make it difficult to create a large, new credit without reducing tax benefits for someone else.



Tax advisers also cautioned the panel not to recommend a poorly designed system that tries to make the current income tax more like a consumption tax by adding new features like large, tax-free savings accounts.



Bob Greenstein, founder and executive director of the Center on Budget and Policy Priorities, called that approach "the worst of all worlds" because it would sap the potential for economic growth gained by a tax on spending and exacerbate the gap between rich and poor.



William Beach, director of the data analysis center at The Heritage Foundation, agreed the panel should avoid a poorly designed hybrid. "The motto is, tax all income once and at its source," he said.

Humana Announces Intent to Participate in Medicare Part D Drug Benefit Program

LOUISVILLE, Ky., March 23 /PRNewswire/ -- Humana Inc. (NYSE: HUM)

announced today that it has filed applications with the Centers for Medicare &

Medicaid Services (CMS) to participate in the Part D Drug Benefit Program

which becomes effective January 1, 2006. This filing represents the next step

in a series of procedures before the CMS-approved plans take effect next

January.

The new Part D drug benefit will allow Medicare beneficiaries access to

prescription drug benefits regardless of the health benefits option they have

chosen. Medicare beneficiaries can choose to stay enrolled in traditional

Medicare and sign up for the new Part D prescription drug plan, or join (or

continue in) a Medicare Advantage HMO, PPO or private fee-for-service plan

that already provides pharmacy benefits. Humana will offer a stand-alone Part

D drug benefit plan in up to 31 of the program's 34 regions throughout the

United States.

In addition, the company announced that it will also participate as a

provider for the newly created Medicare Advantage regional PPO plan in up to

16 of that program's 26 regions.

Both the Part D prescription drug program and regional PPOs were created

as part of the Medicare Modernization Act of 2003.

"As an experienced provider of health benefits for America's seniors,

Humana is pleased to commit to being part of this exciting next step in

meeting the health needs of this growing population," said Steve Brueckner,

Humana's vice president for senior products.

Humana will offer the new Medicare Part D drug benefit as part of its

ongoing commitment to providing an array of health benefit solutions designed

to meet the diverse needs of America's 42 million Medicare beneficiaries.

Enrollment for the new prescription drug plans will begin this November.

Humana offers Medicare Advantage HMO, PPO, and Private Fee-for-Service

(PFFS) plans in 19 states. More than 427,000 Medicare beneficiaries are

currently enrolled in a Humana Medicare Advantage plan. This type of health

plan is an alternative to original Medicare and is a direct result of the

Balanced Budget Act of 1997 and the Medicare Modernization Act of 2003. Humana

Medicare Advantage plans may include a prescription drug benefit, limits on

out-of-pocket expenses, and worldwide coverage for emergency care and urgently

needed care.

ComparisonMarket, Inc. Plans to Add 100 Employees

CLEVELAND, March 22 /PRNewswire/ -- ComparisonMarket, Inc., which owns and operates Insurance.com, the largest online auto insurance agency in the United States, announced today that it has closed on a new round of venture capital to support future growth initiatives, including local expansion of the Solon- based company's call center, information technology and marketing staffs and the launch of a national cable television advertising campaign to promote Insurance.com's services.



David Roush, chief executive officer, said the company plans to add more than 100 new employees to support its expansion, with the sales center alone hiring 15 new insurance agents each month through the summer. ComparisonMarket is actively recruiting for both licensed and non-licensed property and casualty insurance agents. New hires will participate in four weeks of paid training and can earn up to $40,000 a year based on sales, plus a competitive benefits package.



"The continued growth of a technology-driven company such as ours opens up tremendous opportunities for skilled professionals right here in Greater Cleveland," said Roush. "This important round of funding will fuel our growth over the next several years, allowing us to increase our marketing initiatives and execute on our mission of helping consumers make informed financial choices and achieve long-term financial security."

Insurance.com Knows How to Save Money on Auto Insurance

CLEVELAND, March 22 /PRNewswire/ -- A gruff but lovable English bulldog named Otto says he knows how drivers can save money on auto insurance. And Otto ought to know what he's talking about -- after all, he's the spokesdog for Insurance.com, which is out to become the top dog in the auto insurance world.



In a newly launched national cable television advertising campaign, the pooch pitches Insurance.com's insurance marketplace, which allows consumers to compare rates from top auto insurance companies side-by-side. They can then purchase insurance products, either online at http://www.insurance.com/ or by telephone at 1-800-639-9201. "It's so easy, even a human can do it," as Otto points out.



"OK, Otto doesn't really talk," concedes Lou Geremia, president of Insurance.com, already the largest online auto insurance agency in the United States. "But viewers ought to listen to what he's thinking, because there's a good chance they can save on insurance at Insurance.com, where they can compare, buy and save."



According to Insurance.com's recently released 2004 Auto Insurance Pricing Report, quotes for auto insurance premiums increased by as much as 22 percent or decreased by almost 14 percent during the past year, depending on the state.



"That's why it pays to shop for insurance -- exactly the point Otto is making," said Geremia.



In one message, Otto is seen sticking his head out the window of a car, his ears flapping in the breeze.



"Boy, do I love getting taken for a ride," he says -- or thinks. "What I don't love is when the big guy gets taken for a ride on his auto insurance. But who's got time to shop around? That's where Insurance.com can help."



The :30 and :60 spots were produced for Insurance.com by Pickett Advertising of San Francisco.

The Principal Financial Group and Weight Watchers Help Customers Get Healthy

DES MOINES, Iowa--(BUSINESS WIRE)--March 23, 2005--Taking action to address the nation's obesity and related health issues, the Principal Financial Group(R) has launched a new program in cooperation with Weight Watchers of North America, Inc. This program provides the more than 1.6 million health care customers of The Principal(R) access to discounts on Weight Watchers' services, whether the customer participates in a Weight Watchers' program during a local meeting, online or at home. Savings vary by program, but can include free registration and discounts on enrollment and meeting fees of up to ten percent.





"Our foremost concern is the health and wellness of our customers. Even a few extra pounds can have a significant impact on a person's cholesterol, blood pressure and increase their risk for diabetes and heart conditions," said Carey Jury, senior vice president of the Health Division for the Principal Financial Group. "By providing them added incentives to lose weight in a balanced, nutritious and sensible way, we are encouraging our customers to head off any potential problems now, before serious conditions develop."



As one of the nation's most trusted names in weight loss, Weight Watchers offers several options for customers of The Principal interested in participating in a program, including:



-- Local meetings - Meeting coupons provide prepaid admission to local Weight Watchers meetings, with savings on weekly fees and free registration.



-- Online - Weight Watchers online provides a set of robust, personalized tools to help participants stay on track.



-- At home - The Weight Watchers At Home Kit is a convenient weight-loss system that contains 12 weeks of program materials with simple step-by-step instructions delivered to the participant's home. A deluxe package is also available, which includes twenty-six weeks of telephone support, a pedometer, a cookbook and the popular Weight Watchers' books Complete Food and Dining Out Companion.



"The best defense is a strong offense when it comes to warding off serious health conditions and risks. We're encouraging our customers to take action before weight-related problems arise, which can lead to - among other things - sizable healthcare bills," noted Jury.



For more information about the Weight Watchers program discounts available to health customers of the Principal Financial Group, visit www.principal.com/health.

Slash your auto insurance costs

an excerpt from consumer reports



Auto insurance premiums can slurp up a lot of your household cash flow. A typical family can pay more than $2,000 a year for two unflashy sedans. And like monthly mortgage payments, auto premiums seem like one of those annoying carved-in-stone costs in your budget.



Wrong! You may be able to do lots of things to shave your insurance bill by hundreds of dollars a year. Here are six ways to cut your premiums right now, and four tips on avoiding mistakes that can cause your rates to skyrocket down the road.



Shop until your rates drop. To get an idea of how much you can save by shopping around before you buy or renew a policy, we worked with InsWeb (www.insweb.com), an independent Web site where you can compare rates. After examining nine insurers' annual premiums for a two-car policy for a typical couple with clean driving records, we found the gap between the cheapest and the most expensive policies to be a whopping $800. Another place you may find rate-comparison information, as well as company-specific customer-complaint data, is your state's department of insurance Web site. (To find your state's insurance site, go to www.naic.org.)



Cut unneeded coverage. If you have collision and comprehensive--which reimburses you for damage other than collision, such as theft and vandalism--on vehicles worth less than, say, $4,000, depending on your financial situation you might want to consider dropping that coverage, says Catherine A. Franks, a vice president at Amica Mutual Insurance Company in Glastonbury, Conn. Why pay hundreds of dollars a year to replace a jalopy that you're on the verge of jettisoning?



Or raise collision and comprehensive deductibles--the amount of each loss that will come out of your pocket before coverage kicks in. If the levels are set at less than $500, consider hiking them to as much as $1,000. On a typical couple's policy, the difference between a $250 and a $1,000 deductible could be as much as $677 a year. Also, make sure you're not duplicating coverage, such as roadside assistance or towing benefits, which you may already have through an auto club or warranty. If you have medical insurance, consider dropping your auto policy's medical coverage, unless your state requires it.



Sniff out discounts. Insurance companies offer all kinds of price breaks. You may, for example, be able to get a discount for having a good driving record, for installing qualifying safety and anti-theft devices, or for buying several different policies with the same carrier. Check to make sure you're not overlooking any of those discounts. The multipolicy discount can be as high as 20 percent and apply to both your auto or home policy or both. Also, if you've changed jobs recently and your commute has been cut down or you've switched to public transportation, you may qualify for a price cut.



Take a class. In most states, a defensive-driving class can reduce your rates--not to mention the points on your Department of Motor Vehicles record--by 10 percent or more. If your record includes a motor-vehicle offense, you're insuring a teenager, or you're 55 or older, the savings may be even bigger.



Encourage Junior to get better grades. Insurers sometimes give discounts to high school and college students who maintain at least a B average.



Be a joiner. If you're a member of an organization, such as the AARP, you may be eligible for "affinity" discounts. Also check with your college alumni association, trade group, and bank or credit union.





RATE-SAVERS



Avoid tiny claims. If your comprehensive coverage has a $500 deductible and you get a $600 door ding, you might be inclined to file a claim for the remaining $100. But filing small claims, including those for minor damage and towing reimbursements, could eventually land you in a higher-risk category, which can translate into big premiums.



Buy with insurance in mind. If you're in the market for a new or used car, call an agent to check on premiums for each of the vehicles you're considering before you get your heart set on a particular model. Generally, the more expensive the vehicle, the more costly the coverage. Vehicle type also makes a difference. Annual premiums for sedans, minivans, and family cars are on average hundreds of dollars cheaper than for large sport-utility vehicles. Carriers also factor in a model's repair costs and its attractiveness to thieves. For a ranking of the most-stolen passenger vehicles, go to www.iii.org and click on Hot Topics, then on Auto Theft.



Pay your bills on time. This counts because it affects your credit score. Insurers believe that if you play fast and loose with your credit, you're probably also a higher risk on the road. If a couple's credit score drops from excellent to good, their premiums may rise by more than $500.



Drive defensively. Traffic violations and even fender-benders can inflate premiums. To avoid tickets and accidents, use cruise control on highways to help maintain the speed limit. Keep a safe distance from the vehicle ahead of you--doing so will help you prevent accidents and avoid stone damage to your paint and windshield. And park where your car is less likely to be damaged or stolen.

National health insurance: the wrong Rx

By Jeff Jacoby, Globe Columnist | March 22, 2005



THERE IS a bumper sticker on the car ahead of me as I drive down Interstate 93. In white letters on a navy background, it proclaims: ''Single-Payer Health Care!'' That's it. There is no argument, no attempt at logic or emotion or humor -- just an impatient demand for the drastic transformation of one-seventh of the US economy. And note the exclamation point. That is to communicate earnestness, certitude, and indignation -- classic elements of the liberal approach to policymaking: When promoting radical change, passion and good intentions are what matter most. Real-world consequences count for far less.



As it happens, the real-world consequences of single-payer healthcare -- also known as socialized medicine or national health insurance -- are well-documented. Single-payer care exists in Canada, New Zealand, Great Britain, and much of Western Europe. And wherever it has been tried, writes John C. Goodman, president of the National Center for Policy Analysis, ''rationing by waiting is pervasive, putting patients at risk and keeping them in pain.''



In ''Lives at Risk,'' a book published last summer, Goodman and two co-authors, Gerald Musgrave and Devon Herrick, showed that a single-payer system, far from proving a panacea, would make American healthcare much worse than it is. (Some of the book has now been adapted into a monograph for the Cato Institute, ''Health Care in a Free Society.'') The claims endlessly repeated by proponents of socialized medicine -- that it is more efficient, more equitable, and more affordable than American healthcare -- are belied by decades of data from countries that have gone the single-payer route.



There is no denying the grass-is-greener appeal that the idea of nationalized health coverage holds for many Americans. Just recently, town meeting members in 21 Vermont communities, including Burlington and Montpelier, the state's two leading cities, voted to endorse a statewide single-payer system. Some of those town meetings might have voted the other way if members had first read ''Lives at Risk.'' The facts of socialized medicine aren't nearly as pretty as the myths.



It is routinely claimed, for example, that single-payer systems ''guarantee'' every citizen the right to healthcare.



In reality, countries with nationalized systems invariably limit healthcare to control costs. The result, of course, is ever-lengthening wait lists.



Around 25 percent of patients undergoing elective surgery in Canada, Australia, and New Zealand -- and around 36 percent in Britain -- have to wait more than four months for a turn in the OR (The figure in the United States: 5 percent). According to the Fraser Institute, a Vancouver think tank, the average Canadian patient waited 8.3 weeks for an appointment with a specialist in 2003 -- and another 9.5 weeks before getting treated.



Lengthy waits are not trivial. Delays in Britain for colon cancer treatment are so protracted that 20 percent of cases considered curable at the time of diagnosis are incurable by the time of treatment. Last year a lawsuit was filed against 12 Quebec hospitals on behalf of 10,000 breast-cancer patients who had to wait more than eight weeks for radiation therapy. A ''right to healthcare?'' Socialized medicine guarantees only the right to stand in line -- and often to get sicker while you wait.



But when you finally do get to the head of the line in a single-payer country, at least the quality of the care you receive will be top-notch, right?



Alas, wrong.



During your last medical appointment, did the doctor have more than 20 minutes for you? The answer is yes for 30 percent of Americans -- but for only 20 percent of Canadians, 12 percent of Australians, and 5 percent of Britons. Because the number of doctors in Canada is artificially restricted, the country suffers from overstressed physicians and undertreated patients. Thus, while the average US doctor sees 2,222 patients annually, the average Canadian doctor must somehow make time for 3,143.



Consider another measure of medical quality: access to lifesaving technology. British scientists helped develop kidney dialysis in the 1960s, yet today Britons use dialysis at one-third the rate Americans do. If you need a coronary bypass, you are five times more likely to get it in the United States than in Canada (and eight times more likely than in Britain). Access to CT scanners? MRI machines? Lithotripsy units for treating kidney stones? Angioplasty? When it comes to one kind of high-tech medical procedure after another, the average American patient is far likelier to get treatment than his single-payer counterpart. That is why Americans often have a better chance at beating a condition -- such as prostate cancer, renal failure, or heart disease -- that would kill them elsewhere.



The Spectator, a British journal, summed up the issue in the headline of its Feb. 12 cover story: ''Die in Britain, survive in the US.''



The American healthcare system is far from perfect, as Goodman and his co-authors make amply clear. But more government control of that system -- and less private-sector choice -- will not make it better. As our friends in Canada, Britain, and other countries with national health insurance can attest, single-payer healthcare looks better on a bumper sticker than it does in real life.

Fill a car-insurance gap

The auto show that runs through Sunday at the Minneapolis Convention Center may infect you with new-car fever. But here's a tip before you dive in.



Consider gap auto insurance if you're buying a new vehicle with little or no money down. Nearly 30 percent of new-car buyers are "upside down," meaning they owe more on their loans than their cars are worth, according to Money magazine.



Let's say your new car is totaled in an accident six months after you buy it. Your insurance company will pay you only for its actual cash value. And because most cars depreciate 10 to 20 percent when driven off the lot and up to 50 percent in the first year of ownership, you could owe the bank several thousands of dollars more than what your settlement check covers.



Gap insurance increases the total cost of comprehensive and collision insurance by 5 to 10 percent, but keeps the car owner from being in the hole when shopping for a different vehicle. It pays the difference between the actual cash value of the totaled car and the amount of the loan. The insurance is available only when the car is new.

HSA-related plans spark interest

Consumer-driven health plans have sparked the interest of Capital Region businesses struggling to afford employee benefits, but supply does not yet meet demand.



Rising health insurance costs are a top concern for employers of all types and sizes. When Benetech Inc., a North Greenbush-based employee benefits firm, conducted its sixth annual survey of Capital Region businesses, it found average premium increases of 14 percent to 22 percent, depending on the type of plan offered.



That has employers hungry for ways to trim premiums. Of the respondents to the Benetech survey, two-thirds raised medical co-pays and deductibles on employee plans and 56 percent hiked prescription drug co-pays.



More than half asked for bigger contributions from workers. Nearly a quarter reduced benefits, and 5 percent were forced to stop offering health insurance to their workers.



Forty-seven percent said they are pinning their future hopes, at least in part, on consumer-driven plans.



These high-deductible, preferred-provider organization (PPO) plans give employees control over their health care dollars. Each individual has an account, often a tax-exempt Health Savings Account (HSA), from which bills are paid. Unused funds are rolled over.



The theory is that relatively healthy employees can lower their expenses by shopping around for doctors, buying generic drugs and thinking twice about seeking medical attention for minor ailments.



"It is seen as a way to help control the cost," said Barry McNamara, spokesman for Benetech. "Employers have run out of options for traditional cost-sharing and cost shifting. High-deductible plans offer a much more direct premium reduction."



McNamara said some employers can cut premiums enough to cover part of the employees' deductibles or provide a benefit--such as a dental plan--they had not previously offered and still come out ahead.



Although nearly half of the survey respondents told Benetech they expected to offer their employees a consumer-driven health plan option in the future, only 5 percent actually did as of late 2004.



The gap seems to exist primarily because local health insurers either just began offering consumer-driven plans or are still in the process of forming them.



"Development of the product locally is behind the interest," McNamara said. "But that will be fixed by Jan. 1."



Albany-based Capital District Physicians' Health Plan Inc. was the first area insurer to offer a high-deductible PPO plan in combination with an HSA. The "AchievaCare" product debuted in late August.



"We have seen a huge amount of interest from both large and small companies," said Robert Hinckley, vice president of government and external relations for CDPHP. "It is attracting a number of our existing customers and bringing in new customers. This is the wave of the future."



Empire Blue Cross & Blue Shield made its consumer-driven plan avaiable Jan. 1 to businesses with 51 employees or more. Karen Early, spokeswoman for the New York City-based insurer, said 42,000 members have signed up so far. She could not say how many are in the Capital Region.



"There is a lot of interest in it for the future," Early said. "[Employers] may not want it now, but they want to know it's going to be there."



Schenectady-based MVP Health Plan expects to introduce its high-deductible PPO in the coming months.



"It will be sometime this year," said Gary Hughes, spokesman for MVP. "It will be earlier in the year rather than later. We have the HSA portion nailed down and are going through the steps of getting the plan rolled out."



MVP already has unveiled a consumer-direct pharmacy benefit that can be attached to any of its traditional health plans. Hughes said this gives employers a chance to try out an employee-controlled plan before expanding it to health care.



Of the 5 percent of area employers that offered consumer-driven plans, 13 percent also offered HSAs, which were created by the Medicare reform legislation enacted in late 2003.



In January, Glens Falls-based Evergreen Bank became the first area financial institution to house HSAs. Daniel Burke, president of Evergreen, said businesses have responded favorably, but only a few have opened accounts, largely because of the dearth of high-deductible health plans.



"The bank is out in front of the insurers on this one, which was something we didn't realize," Burke said.

Blue Cross of La. seeks new CFO

By TED GRIGGS

tgriggs@theadvocate.com

Advocate business writer



Blue Cross and Blue Shield of Louisiana, the state's largest health insurer, is again shopping for a new chief financial officer.

Mike Rishell, senior vice president and CFO, and Blue Cross President and Chief Executive Officer Gery Barry mutually agreed that it was time for Rishell "to pursue another career opportunity," company spokesman John Maginnis said Wednesday.



Maginnis said he did not know what Rishell's future plans involved. Rishell could not be reached for comment.



Rishell became Blue Cross's chief financial officer in 2002. He replaced Carl Kennedy, who had said in published reports that he was fired in 2001 by Blue Cross President and Chief Executive Officer Kathryn Sullivan.



Kennedy was named chief financial officer at Blue Cross in 1999. He took over when Sullivan moved up to the chief executive's office.



Sullivan herself was ousted by the Blue Cross board of directors in 2004 and later replaced by Barry.



Maginnis said he could not comment on the reasons for Rishell's departure, other than the decision was mutual.



CFO Magazine lists a number of reasons for CFO's increasingly short tenures. One popular reason is that a company's new chief executive officer wants his or her own person in the position.



CFO Magazine has reported the average tenure of a chief financial officer is eight years. However, some executive placement firms place the average at two years or less.

lack of health insurance hurts lesbians

To: National Desk, Health Reporter



Contact: Nancy Wong of Harris Interactive, 585-214-7316; Colleen Dermody, 202-887-0500 ext. 18, cdermody@witeckcombs.com or Shameka Lloyd, 202-887-0500 ext. 25, slloyd@witeckcombs.com



ROCHESTER, N.Y., March 16 /U.S. Newswire/ -- According to a new national online survey, health care costs (50 percent) and the lack of adequate health insurance (43 percent) are cited as the most common reasons why lesbians have delayed obtaining health care. When asked to identify what current health issue deserves the most attention from health care professionals and public policy makers from among a list of 14 issues, two in five (41 percent) lesbians said that health insurance coverage, followed by nutrition/exercise (14 percent) and obesity (12 percent) deserve the most attention.



These are some of the results of a nationwide online survey of 2,209 U.S. adults, of whom 119 have self-identified as gay, lesbian or bisexual (GLB). In addition, 341 self-identified U.S. lesbian adults were surveyed. The survey was conducted online between January 11 and 16, 2005 by Harris Interactive(r) in conjunction with the Mautner Project, The National Lesbian Health Organization.



Overall, three quarters (75 percent) of lesbians (compared to 54 percent of heterosexuals) have delayed obtaining health care for at least one reason. Younger lesbians (aged 18-35) are more likely than older lesbians (aged 50 and over) to have delayed obtaining health care.



"Barriers to accessing health care, whether they are financial, institutional or cultural, can be devastating for lesbians with chronic or life threatening illnesses," said Kathleen DeBold, executive director of the Mautner Project. "Stigma and the potential for discrimination has, for years, been a major obstacle for lesbians and gays seeking appropriate health care. This survey is another in a line of important wake-up calls for the medical establishment."



Additional findings from the survey include:



-- All adults (35 percent) think that health insurance coverage deserves the most attention from health care professionals and public policy makers, followed by cancer (16 percent) and obesity and HIV/AIDS (9 percent each).



While GLB respondents (18 percent overall) and lesbians (9 percent) think that HIV/AIDS deserves the most attention, fitness is also high on their list (13 percent and 14 percent respectively).



-- Among lesbians, 16 percent report that they have delayed obtaining health care because they were concerned they would be discriminated against.



-- Lesbians are more likely than heterosexuals to say that bad experiences with health care providers in the past has caused them to delay obtaining health care (27 percent vs. 12 percent).



-- Three quarters of lesbians (74 percent) who have experienced discrimination at a doctor's office believe that they were discriminated against because of their sexual orientation. One in five (19 percent) feels they were discriminated against because of their physical or mental disability and five percent said it was because of their gender identity or expression.



-- Heterosexuals are more likely than lesbians to believe that they were discriminated against because of their income level (35 percent vs. 20 percent).



-- The top two health risks lesbians are worried about for themselves are being overweight (17 percent) and being out of shape/not physically fit (16 percent)



"Getting lesbians to the doctor would be a huge first step in preventing chronic illness among the nation's lesbian population; but to accomplish that, there will have to be a significant change in the way that doctors and their staffs and their lesbian clients communicate," said Amari Sokoya Pearson-Fields, deputy director of the Mautner Project. "If doctors, nurses and other medical professionals are truly committed to providing the best care to all their patients and are sensitive to the unique needs of their lesbian patients, then this can improve."

Auto Insurance Inflation Slows

By Anita Szoke



of the Journal Star



PEORIA - State Farm's move to lower its auto insurance rates in Illinois reflects a national slowdown of auto insurance rate increases in 2005.

The Bloomington-based insurer, the largest insurer of autos in Illinois and in the nation, announced Tuesday it is cutting its overall auto rate level in Illinois an average of 5 percent. Current policyholders will see changes when their policies come up for renewal.



The rate reduction represents an annual savings of $82 million to the company's Illinois customers, said State Farm spokesman Joe Johnson, adding the company is able to offer the reduction because of fewer claims and improvements in the company's operating efficiencies.



About one in every three cars insured in Illinois is insured by State Farm, Johnson said. The company doesn't release the number of auto policies it has in Illinois or a percentage of total policies it writes.



Nationwide, the cost of auto insurance is expected to rise by just 1.5 percent in 2005, the smallest increase in five years, according to the Insurance Information Institute.



The average cost for auto insurance nationwide for 2005 is estimated at $870, an increase of $13 per vehicle from last year, reports the I.I.I. The projected increase represents a continued slowdown from 2004, when auto insurance costs rose by just 2.8 percent, said Robert Hartwig, senior vice president and chief economist of the I.I.I.



"The price of auto insurance is increasing by little more than one-half the rate of inflation," Hartwig said. "Many people who, for example, drive safe cars, have excellent safety records and good credit-based insurance scores may see their rates go down."



Hartwig cited the declining number of auto accidents, safer cars, new auto theft technology and fraud-fighting efforts as key factors behind the trend.



Nearly two dozen insurance companies have filed rate changes with the Illinois Department of Insurance in January and February, with a large portion of the insurers filing rate reductions, according to the department's Web site.



Allstate Insurance Co. of Northbrook doesn't intend to file an auto rate decrease, said company spokesman Mike Siemienas. "Our rates are already competitive in Illinois," he said. State Farm has implemented rate decreases in 17 states in 2005 and one increase, which is in North Dakota, where the company increased auto rates an average of 3.2 percent.



The states in which State Farm decreased auto rates to date in 2005 were: Alabama, Colorado, Connecticut, Delaware, Florida, Illinois, Iowa, Louisiana, Mississippi, New Jersey, Ohio, Oregon, Pennsylvania, South Dakota, Tennessee, Utah and Wyoming.



The rate decreases range from an average 1.3 percent in South Dakota and Wyoming to an average 7 percent decrease in Connecticut, Johnson said.



All of those rate changes, including the one rate increase, represent a $383 million savings for the company's customers, Johnson said.



The auto rate cut in Illinois is State Farm's fourth such reduction in the state since September 2003, when the company raised auto rates in Illinois an average of 3.4 percent. Last year, the company had two rate reductions - a 5.5 percent statewide average decrease on March 1, and a 0.9 percent rate reduction Sept. 15.



- along with a 0.2 percent decrease Oct. 15, 2003.

MARCH TO HIPAA: The best insurance policy

Most healthcare organizations have one more month to meet the security requirements of the Health Insurance Portability and Accountability Act (HIPAA). Will they make it? SearchSecurity.com interviewed IT, security and compliance professionals across the United States over a two-month period. What we found is the massive patient privacy law is a bitter pill for some to swallow and the best prescription for others to follow.

There's good reason security and compliance managers at some states' Blue Cross and Blue Shield (BCBS) aren't sweating heavy with HIPAA's approach.

"We've been handling sensitive information forever," said Harry Reynolds, vice president of HIPAA and information compliance officer for BCBS of North Carolina, which has 3,400 employees, 3.1 million members and a network that includes hundreds of servers. "Securing information and privacy has always been a top priority."

As technology has advanced, he said, the organization has treated network upgrades as a simple business practice. If anything, he said HIPAA's security rules validate their efforts. "In our industry, this stuff is an inherent requirement regardless of the HIPAA regulations," Reynolds said.

It's been a similar experience for Joe Gilfus, IT project manager for BCBS of Florida, which has 6.6 million members and 9,000 employees.

"The biggest change is that we have a more automated process for monitoring network access," he said. "We've had a long effort with role-based access, but as the system has become more automated we've gotten better at giving people just the right amount of access for their jobs -- nothing more, nothing less."

But while a majority of insurance companies seem to have the technology issues down pat, two HIPAA specialists said this sector is far from ironclad.

"Insurance companies struggle with which information is private and how much is need-to-know," said Randall Gamby, consultant for Midvale, Utah-based Burton Group. "They're struggling to define the need-to-know information that must be exchanged to process claims and provide coverage."

Drew Williams, co-founder of the Center for Policy and Compliance and principal consultant for Utah-based SummitWatch Consulting Services, said insurance firms may have their technological house in order. But from what he has seen, they're not grasping the open access part.

"Clients will call about seeing someone for a specific problem like HIV," Williams, who's also vice president of corporate development for Colorado-based Configuresoft, said. "That information gets passed along by e-mail. Under HIPAA, the provider can't respond by e-mail and the best they can do is acknowledge they received the inquiry and send them to a customer service representative. But I've seen cases where they'll still answer those messages. What they need is a Web site specifically for these inquiries, where questions can be answered securely."

As other healthcare organizations grapple with need-to-know questions, insurance companies are dealing with increasingly anxious members.

"When we deal with outsiders like the individual doctors' offices, we ask more questions than we used to," Reynolds said. "And among customers there's this enormous angst because they're dealing with different health organizations, all of which have their own HIPAA procedures. We have our rules regarding who we can and can't talk to. But it's the customer's information -- their lives -- and different organizations have different controls."

Jackie Boyden, vice president of corporate ethics and privacy for BCBS of North Carolina, said her organization has gone to great lengths to help employees understand right from wrong.

"Security has always been part of our culture, but with HIPAA we wanted to be sure the rules were understood enterprisewide, from the top down," she said. "As a result, we set up a privacy office and a privacy and security committee. We also chose privacy and security coordinators from every department. It was a smooth adjustment."

Privacy and security goals were also built into each employee's evaluation criteria, and training programs were beefed up to better emphasize today's security challenges, Boyden said.

BCBS of Michigan has also launched training and awareness programs to meet the challenges, said Kim Winnik, director of corporate compliance for the organization, which has 8,000 employees and 4.8 million members.

"Security is only as good as those who follow the policies," she said. "We have a theme -- 'Security is Everyone's Business' -- and we emphasize that everyone has a role in reporting problems. We've mandated that employees take a refresher course on the privacy rules of HIPAA, and as part of the training program people take a test. If they don't score at least 80%, they have to take it again. When they reach 80%, they receive a certificate. To us, the training has been the most important thing."

On the technical side, BCBS of Michigan's story is similar to the others. Pam Hensley, the organization's security architect, said a big challenge is in finding a more centralized, consistent documentation method. That's no easy task when there are hundreds of servers in the network, each with a different way of documenting activity.

"We had a risk assessment conducted and they gave us a list of items they couldn't find in the documentation," Hensley said. "It's been a big challenge." There's also the challenge of how to secure data on laptops. "We have a limited number of people who must carry information on their laptops," she said. "We're rolling out a laptop encryption tool as we speak, and we now have a consolidated auditing tool. We can pull all the information from a distributed environment to a centralized point and monitor network activity more effectively."

In the end, all agree no organization is perfect when it comes to HIPAA. The key is to take lessons from the law that will ensure more security as technology and threats change in the future.

"People need to see HIPAA as an ongoing process, not as a rush to meet a list of regulation requirements," Boyden said. "This is not a destination, but a journey."


The following graphic applies to larger health care organizations. Smaller practices have more time to comply.

Health Insurance Companies sue providers

Blue Cross and Blue Shield of North Carolina is one of a dozen providers filing a lawsuit against health care providers in southern California.


Raleigh, NC -- Blue Cross and Blue Shield of North Carolina is one of a dozen health care groups from various states filing a lawsuit against health care providers in southern California.

Authorities say doctors in southern California were part of an elaborate "rent a patient scheme."

The California clinics are accused of paying recruiters to find patients willing to undergo unnecessary medical procedures.

The patients, mostly low income immigrants, received cash for their time. Clinics then submitted inflated insurance claims

The insurance companies claim they've sustained losses of $345 million.

GAINSCO Reports 4th Quarter and Year 2004 Results

DALLAS, March 11 /PRNewswire-FirstCall/ -- GAINSCO, INC.
(OTC Bulletin Board: GNAC) today reported net income for the fourth quarter
2004 of $1.8 million. After the accretion of the discount on the Redeemable
Preferred Stock of $0.9 million and dividends on the Redeemable Preferred
Stock of $0.3 million, net income available to common shareholders for the
fourth quarter 2004 was $0.6 million, or $0.03 per common share, basic and
diluted.
For the year ended December 31, 2004, net income was $5.5 million. After
the accretion of the discount on the Redeemable Preferred Stock of
$3.4 million and dividends on the Redeemable Preferred Stock of $1.1 million,
net income available to common shareholders for the twelve months ended
December 31, 2004 was $0.9 million, or $0.04 per common share, basic and
diluted.
"Our profit this quarter was due to the Company's continued success in its
nonstandard personal automobile insurance business and the realization of
capital gains in its investment portfolio. With the capital restructuring
transaction accomplished, the Company is now pursuing its long-term growth
plan in nonstandard personal automobile insurance. We began writing business
in Nevada and initiated our California program in the fourth quarter of 2004,
giving us additional momentum going into 2005," said Glenn W. Anderson,
GAINSCO's president and chief executive officer.
The Company is now writing nonstandard personal auto insurance in the five
states of Florida, Texas, Arizona, Nevada and California. As a result of the
expansion and diversification efforts currently in place, the Company
experienced significant growth in premiums written during the first two months
of 2005. The Company's implementation of its expansion plan is occurring in
an increasingly competitive environment and could be adversely impacted by
such market conditions.

Judy Fourie Named To NC Health Insurance Innovations Commission

Cary, NC – Judy Fourie, President of J. Fourie & Company, an insurance company specializing in health insurance for groups and individuals was recently appointed a member of the North Carolina Health Insurance Innovations Commission. As a member of this commission, Fourie will lend her expertise to issues including the cost of existing health insurance mandates and potential reforms that could reduce such costs. The Health Insurance Innovations Commission was established to address the availability and affordability of health insurance coverage for small business owners and employees.

“I am honored to be a part of this commission,” said Fourie. “I plan to work hard to ensure that small businesses have every opportunity when it comes to health insurance.”

High-End Cars, Low-Price Insurance

NEW YORK, March 9 /PRNewswire/ -- With a few insurance companies heavily advertising low prices and the ability to get quotes over the Internet, many people have become more price-conscious when purchasing auto insurance. But choosing the lowest price could end up costing consumers a lot more if they have an accident, especially if they own a high-end auto, warns Atlantic Mutual.



"We are seeing a growing tendency among consumers to view auto insurance as a commodity product," said Dan Olmsted, president of Atlantic Mutual. "This is a dangerous misconception because coverage terms and limits and service quality can vary greatly among companies."



Atlantic Mutual is offering a free list of questions to ask when obtaining auto insurance quotes. Available at http://www.atlanticmutual.com, the questions will help consumers understand the quality of coverage and service being offered. Four of the most important questions are:



Will the insurance cover replacement parts from the original manufacturer? Some low-price auto policies will only pay for "generic" auto parts from third-party manufacturers. The quality of these parts may differ from the originals. The discrepancy can be of particular concern to owners of luxury or high-performance autos. Policies designed more for the affluent customer will pay for parts produced by the original manufacturer, also called "OEM" parts.



How much will I be reimbursed if my car is "totaled?"



Even if your 7-year old Lexus looks and runs like new, standard policies sold at the lowest rates can take thousands out of your reimbursement by applying the most aggressive form of depreciation. Replacing your car -- even with another used one -- could seriously dent your wallet. Ask about adding an "agreed value" clause to your policy. This feature enables you to establish the value of your auto with your insurance company before it becomes a total loss, so you avoid an unpleasant surprise.



Will the cost of renting a comparable car be covered?



Even if you're used to ferrying the kids to school or commuting in a large sport-utility vehicle, low-price insurance policies may come with per-day and total spending limits that barely pay for briefly renting an economy car. Repairing or replacing your auto could take weeks, so be sure to consider policies with limits that will allow you to rent a comparable car for an extended period.



What quality of claims service can I expect?



Even companies selling low-price policies promise to deliver excellent claims service, so it's best to seek a second opinion apart from the company's website or advertising. Ask an independent agent which company has the best claims service. Or, check with your state's insurance department. Some states (such as New York and New Jersey) provide information about the number of legitimate complaints lodged against auto insurance companies.



"It seems so easy to compare by price, but insurance consumers need to dig into the more complex coverage issues too," said Olmsted. "Insurance is an important financial service, and like any service or product, you get what you pay for."



"That's why we recommend working with an independent agent," continued Olmsted. "Representing multiple companies, the independent agent has the expertise to discuss coverage and service as well as price and make sure consumers select the company that best meets their needs." Consumers can find a list of agents representing Atlantic Mutual at http://www.atlanticmutual.com.

health Insurance company told to stop business in WA

SEATTLE POST-INTELLIGENCER STAFF



TUMWATER -- The state Insurance Commissioner's Office said yesterday that it has ordered a health insurance company with about 37,000 Washington policyholders to stop selling plans in this state.



Officials said the plans sold by Mega Life and Health Insurance Co. of Oklahoma violate Washington law. Mega could not be reached for comment last night.



According to the Insurance Commissioner's Office, most of Mega's policies do not include benefits mandated by state law. Also, the company has failed to file required paperwork, the agency said.



Policyholders with questions can contact the Insurance Commissioner's Office at 800-562-6900.

Farmers insurance to ease rates in CO

By Rachel Brand, Rocky Mountain News

March 8, 2005



The state's No. 2 auto insurer will lower rates next month, following a statewide trend toward lower auto insurance prices.



Farmers Insurance, insurer of 480,000 Colorado autos, will drop rates an average of 3.2 percent on April 1. The firm also will offer steeper discounts to people who buy multiple policies for home, life and auto.



Some drivers could see up to 20 percent savings: people with expensive or frequently stolen car models, those who sign up for a $1,000 deductible and those with multiple policies.



"We're not seeing as many claims, and the cost of the claims are down," said Doug Compton, agency consultant for Farmers Insurance. He said consumers should get the decrease when they renew their policies but can ask for a midterm renewal.



The Progressive Group of Companies, the state's No. 6 auto insurer, filed a 5 percent average rate decrease last week, effective March 22. In December, State Farm Insurance lowered rates an average of 3.2 percent.



"This points to a trend," said Carole Walker, executive director of the Rocky Mountain Insurance Information Institute, crediting the switch from no fault to tort.



Colorado's auto insurance system reverted to a tort, or at-fault system, in 2003. Now the at-fault driver is responsible for all costs of an accident and can be sued.

free health insurance for kids

A family of four earning up to $44,520 annually can now qualify for free medical insurance for their children through the state's QUEST and Medicaid programs.



The federal government has raised family income limits for the public health insurance to help families previously ruled ineligible because of slightly higher income, said Barbara Luksch, Hawaii Covering Kids Project director.



The figure for a family of four is $1,152 more than last year's limit, and the guidelines are retroactive to Jan. 1, she said.



Luksch urged families to reapply if they have been denied benefits and fit within the new limits.



Hawaii Covering Kids was established as a project of the Hawaii State Primary Care Association to try to find uninsured children and sign them up for the state's health insurance programs.



More than 9,000 additional children were enrolled and retained in QUEST and Medicaid last year, "which is incredible for our state," Luksch said.



Enrollment in QUEST and Medicaid in December 2003 totaled 89,481 kids, she said. Last December, the figure was 98,691.



Luksch attributed the growth to changes in the program.





» A passive renewal process began in June to renew children in the programs instead of closing cases if the family forgot to renew. A family only needs to fill out and return a renewal form if it has had household changes.

» More outreach workers were funded by the Centers for Medicare-Medicaid Services and MedQUEST to reach families in communities and help them with applications.

» And a new application was started in January 2003 for children and pregnant women that eliminated a question about an absent parent.



Luksch said the change in the application was needed because eligible children were not being enrolled because of the question.

The question was a huge barrier for grandparents and others concerned about reporting absent parents, she said, noting a computer link with the Child Support Enforcement Program.



"So, we've eliminated barriers, and we've got more outreach workers in our community," Luksch said. "It's been great."



In addition, she said Covering Kids is partnering with MedQUEST to hold training workshops for agencies and organizations that have contact with families and can help them apply for free health insurance. She said about 30 percent of applications were being denied because people did not answer all the questions.



Since expansion of outreach workers and the training program, application denials have dropped to 9.5 percent, she said.



Covering Kids' latest project is to partner with 150 pharmacies statewide to distribute half-page fliers asking, "Do you know a child who needs free or low-cost health insurance?"



The "bag stuffer" explains what is covered and lists a hot-line number, a Web site address and other information, she said.



The flier has been translated into 13 languages besides English, Luksch said, "and we're working on more to try to get the word out to immigrant communities."