UPDATED Gov. Candidates: Health Insurance Rate Hikes ‘Outrageous’
Thursday, May 20, 2010
UPDATE The day after gubernatorial candidates blasted two major insurance companies for rate hikes, outage again erupted over a proposed double-digit rate hike by the third major insurance provider in Rhode Island, United HealthCare of New England.
“What happens to all the money that these gigantic insurers are making? Don’t they keep any of their profits in the till to try to offset the huge rate hikes that they invariably ask for?” said Attorney General Patrick Lynch. “Three years ago, United HealthCare wanted to take $37 million of the more than $50 million profit it had cleared in Rhode Island and return the money to its shareholders.”
“I am unequivocally opposed to increases in premiums for our business community and families who simply cannot afford to bear this burden," added Lt. Governor Elizabeth Roberts. "It is irresponsible of the insurers to pass along increases to customers when they have shown clearly they have failed to effectively manage and contain costs."
GET THE LATEST BREAKING NEWS HERE -- SIGN UP FOR GOLOCAL FREE DAILY EBLASTORIGINAL STORY There was no shortage of outrage among candidates for governor yesterday, after two major health insurance providers proposed rate hikes.
“Outrageous and unacceptable” was how Democratic candidate Frank Caprio described them while fellow Democrat Patrick Lynch—who spoke through the Attorney General’s office—decried them as “excessive, “exploitive,” and a “slap in the face of Rhode Islanders.”
Blue Cross Blue Shield wants to raise rates by 12.4 percent for small businesses and 13.4 percent for larger groups. Tufts Health Plan wants increases between 11 and 12 percent.
The indignation spanned party lines.
“Twelve percent or 13 percent rate hikes cannot be justified, nor our businesses able to absorb these additional costs while they are struggling to survive in this terrible economy,” said Republican John Robitaille. “We have zero inflation now, so no one can justify these outrageous rate increases.”
Fellow Republican Victor Moffitt wasn’t too happy either—he said he already pays too much for his health insurance.
Moderate Ken Block, meanwhile, said the higher rates were “unsustainable” for the state and made health insurance “unaffordable” for families and businesses.
Independent Lincoln Chafee took a different tack.
“Senator Chafee is keenly aware that Rhode Island’s next governor is going to immediately assume the role of a health care governor as the result of federal changes that will take affect over the next few years,” said campaign manager J.R. Pagliarini.
Candidates Differ on How to Fix Health Costs
While most of the candidate were of one mind in opposing the rate hikes, they split over how the underlying problem of health insurance costs should be solved.
Robitaille and Lynch both said that Insurance Commissioner Chris Koller should deny the requests for the rate hikes, but Robitaille said the solution was in tort reform, incentives for wellness initiatives, and including primary care and prevention in every health care plan. Lynch said Blue Cross should open its financial books to public scrutiny.
Block said lack of competition and overregulation were at the root of the problem.
Pagliarini said that as governor, Chafee would create a “Health Care Exchange” that “will work towards making our health care delivery system affordable and sustainable.”
In a press release, a Blue Cross Blue Shield official said that the higher premium costs reflects the rising costs of health care. Gus Manocchia, a vice president at the company, pointed to increased costs in hospitals and prescription drugs.
“Given these circumstances, premium rates have not been able to keep pace with increasing medical claims costs, which for BCBSRI were approximately $1.5 billion in 2009,” Manocchia said.
