Health insurers across the country are planning to raise premiums for some of their customers in the coming weeks. They are in part blaming President Obama's health care reform package for the rate hikes. The White House and other supporters of the reform package are skeptical of the health insurance companies' rationale.
Aetna Inc., some BlueCross BlueShield plans and other smaller carriers have asked for premium increases of between 1% and 9% to pay for extra benefits required under the law, according to filings with state regulators. The rate increases would largely apply to individual plans and those offered for small businesses.
Apparently health insurance premium increase comes with benefits.
Early benefits cited by health insurance companies for the rate increase include children up to 26 years old to staying on their parents' health care plans, eliminating co-payments for preventive care and prohibiting insurers from denying coverage to children with pre-existing conditions. These benefits apply to all plans, not just individual and small business policies.
Some customers could see their premiums increase by more than 20 percent. Because the insurers are also reportedly asking for further rate increases they are not tying to the health care overhaul that they say are needed to cover rising medical costs.
The White House says insurers are using the law as an excuse to raise rates and predicts that state regulators will block some of the large increases. "I would have real deep concerns that the kinds of rate increases that you're quoting... are justified," said Nancy-Ann DeParle, the White House's top health official. She said that for insurers, raising rates was "already their modus operandi before the bill" passed. "We believe consumers will see through this," she said.
The health care overhaul has proven to be a harder sell to the American people than Democrats anticipated, prompting at least a handful of Democrats up for re-election to campaign on their vote against the reforms. Moderate Democrat Stephanie Herseth Sandlin (S.D.), for instance, says in an ad that she voted against the bill because "it wasn't right for South Dakota."
The news is giving a boost for the Republicans' arguments against the Democrats' reforms ahead of this year's midterm elections. Complaints haven't stopped Republicans from jumping on the opportunity to criticize the Democrats' policies. Senate Republicans are highlighting the Journal's report while pointing to past comments from Mr. Obama and other Democrats, who promised that premiums would not increase as a result of the reforms.
"The health insurance industry is doing the same thing it has always done, raising premiums to achieve excessive profits and outrageous salaries for their CEOs," HCAN executive director Ethan Rome said in a statement.
In Kentucky, Republican Senate candidate Rand Paul slammed health care reforms in his first general election ad. Republicans, who have sought voter support by opposing the health law, say premium increases could help in November's congressional races. "People are finding out what's in the law, they don't like it, and I think it's going to play a big factor in this election," said Iowa Sen. Charles Grassley, the top Republican on the Senate Finance Committee.
Health Care for America Now, a coalition group in support of the health care overhaul, slammed the insurance industry and pointed to insurers' history as evidence that its latest claims were misleading. For instance, WellPoint's Anthem subsidiary had to reduce its proposed rate hike in California earlier this year after it tried to justify increases as high as 39 percent with erroneous numbers.
While President Obama touts the new health care law everywhere he goes, some members of his party are saying just the opposite in re-election ads, making sure their constituents know they voted against the unpopular overhaul. Other Democratic lawmakers are choosing a silence-is-golden approach on the campaign trail.
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