Children's Health Insurance Coverage Changes

The Congressionally approved spending increase children's health insurance program will maintain health insurnce coverage for those already enrolled, but those currently lacking health coverage will have to look elsewhere. This development could not have been foreseen a year ago. Democrats proposed a huge spending increase on the federal-state partnership known as the State Children's Health Insurance Program. In addition, Many Republicans embraced the idea, while states were drawing up plans to expand health insurance coverage.

Virginia was one of several states going into the year thinking about expanding eligibility limits for SCHIP. It's a typical state in that it provides health coverage for families with incomes up to twice the federal poverty level. Lawmakers across the state line in West Virginia approved an expansion that would have raised the eligibility level to $51,510 for a family of three. It's now at $37,774. The increase would have led to about 4,000 more West Virginia children receiving health insurance coverage.

Republicans say any expansion should not allow middle-income families to drop private health coverage for the government sponsored coverage. They insisted that SCHIP retain a new Bush administration directive that makes it harder for states to cover middle-income children. Democrats criticized the directive for months. They promised to rescind it, but failed.

The directive said that before states cover higher-income children, they must meet the following threshold: At least 95 percent of children eligible for Medicaid and SCHIP with incomes less than twice the poverty level must be enrolled in those programs.

Many states say meeting that threshold is nearly impossible. But that's not all the directive said. Even if states meet that threshold, the middle-income children will have to go without private health insurance coverage for a full year before they can enroll in SCHIP, and their families will have to pay premiums or co-payments that are 5% of their income.

The directive will affect about half the states. 14 are already covering children above $42,925 for a family of three and 10 more were planning to do so, says the Center for Children and Families at Georgetown University.
One of those states, California, is considering a proposal that would require all Californians to have health insurance coverage, but a central piece of that proposal also increases the threshold for SCHIP eligibility — from the $42,925 level for a family of three to the $51,510 level.

Blue Cross Blue Shield of Michigan rate calcualtion critized

a nationally renowned health insurance expert testified at a consumer hearing that Blue Cross Blue Shield of Michigan used flawed, inappropriate methods to determine proposed rate hikes at issue in a consumer challenge.

James Geyer, former chief actuary for Aetna Inc., said BCBSM methods resulted in a substantial overstatement of its losses from its individual health insurance policies purchased by individuals without employer sponsored coverage, participation in these policies is growing as employers drop workplace health insurance benefits.

BCBSM earlier this year sought a 24% increases, on average, for these individual health insurance policies. Blue Cross was granted a 10% interim rate hike, which took effect June 1. The rate hikes affect roughly 19,000 people in 7 Blue Cross individual health plans. Blue Cross says the rate hikes are needed to offset losses in the individual health business, which totaled $52 million over 10 years.

If BCBSM had performed a more precise analysis of growth in the value plans the insurer would either break even or make $1.3 million, Geyer said, instead of incurring as much as $13 million in losses from the lines of business in question.

New York Health Insurance Plan

From Lower Hudson Online

A NY state lawmaker proposed today that New York create a $59 billion health insurance program that would cover everyone in the state, and probably be paid for through a huge tax increase.

The plan, by Assembly Health Committee chairman Richard Gottfried, would generally replace the private health plans that now provide coverage to residents through their jobs.

He offered no suggestions, however, on how to pay for the health plan, which would give New York the country's largest state-run health insurance program.

Gottfried acknowledged that the program would have to be paid for by new taxes, but he said he believed NY residents would wind up paying less under his plan than they pay now in health insurance premiums and deductibles. His office estimated that the current system costs New Yorkers and their employers $63 billion per year.

The proposal was applauded by some groups that have lobbied for universal health care, but criticized by others who suggested there was little evidence the state could afford it, or that it could do a better job than the current insurance system.

Gov. Eliot Spitzer, who announced earlier this week that he would commission an independent research group to help develop a plan for universal health coverage, said he welcomed Gottfried's proposal as a "valuable option" worthy of future study.

Health Insurance Membership Increased

Press Release

Membership in health plans for the health insurance industry’ s leading health care companies (such as Blue Cross Blue Shield etc. ) grew by 3.2% from 2nd quarter 2006 to 2nd quarter 2007.

ASO enrollment (members in self-insured employer plans for which insurers provide administrative services only) grew at a rate of 6.5% while risk-based membership increased by less than 1% during the year.

MFA analyzed enrollment trends among eight top health insurers — Aetna, CIGNA, Health Care Service Corporation (HCSC), Health Net, Humana, Kaiser Permanente, UnitedHealth Group, and WellPoint.

Aggregate ASO enrollment for these companies grew by more than 3 million members over the year, while risk membership grew by only 285,000.

This has been the trend in recent years, as employer-sponsored plans have moved away from risk-based arrangements.

Further analysis shows that among the top competitors, only Health Net saw an overall decline in membership since the end of the 2nd quarter 2006.

Auto Insurance Rates

Auto insurance rates have been dropping for the last couple of years as consumers shop around for better deals, and auto insurers are starting to believe it can't go on much longer without compromising profits.

The biggest auto insurers help drive consumer shopping with massive advertising budgets and selective price cuts, putting auto insurers beyond the top-tier in a quandary as they try to find innovative ways to attract attention.

Mild catastrophe seasons over the last couple of years have helped keep insurance profits healthy generally for insurance companies, but a Standard & Poor's report last week on personal lines insurance warns that profit margins could tighten considerably if insurers discount too deeply or loosen terms too far in order to keep their customers.