Some Health Insurance Bills Are Rising Under New Law
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New York State’s landmark health insurance law, which ends the practice of setting higher rates for the elderly and less healthy, has had the expected result of driving up the average price of commercial insurance for individuals, by 18 percent, and for small groups, by 19 percent, according to the State Insurance Department. While the law gives consumers more choice of coverage, several commercial insurers have simply pulled out of the small-group market in New York State altogether rather than comply with the law, which goes into effect April 1. The sweeping law, passed by the Legislature last year, forces insurance companies to abide by the same rules as nonprofit insurers like Empire Blue Cross and Blue Shield, which accepts any applicant, no matter how ill. It also forces insurers to set rates without regard to age, sex, or medical condition, as the nonprofit insurers do now. New York State officials, who pressed hard for the law last year, said that the market is merely sorting itself out, with artificially low prices finally rising to their true levels. Pointing out that rates for many older people have actually decreased, the officials say that New York’s experience is likely to be mirrored nationally, when consumers find that health-care reform might well mean higher costs for many people. Anger Over Increases But that is little consolation to New Yorkers whose rates are going up, some by more than 100 percent. “The jump is a one-time jump, but it’s certainly hard to sell to people who are paying the money,” admitted Salvatore R. Curiale, the state Insurance Superintendent, whose office has been bombarded with complaints from angry consumers. One such consumer is Clarence A. Price of Binghamton, who runs a Roto-Rooter sewer and drain cleaning business with nine workers, including himself and his wife. Under the old system, Mr. Price paid about $326 a month to provide health insurance for each of his young workers and their families; as of April 1, his insurance company informed him that the cost per family would increase to $437 a month. “I had to sit down with my employees and tell them that there was no way we could do this,” said Mr. Price, who is shopping around for a cheaper policy and plans to ask his workers to contribute $10 a week to cover the premiums. But for every Mr. Price worrying about paying the premiums, there is someone else who has been helped by the law. For 36 percent of the people in the market, Mr. Curiale said, it means at least modest rate decreases. And for another portion who work for small businesses and become ill, the law means more freedom to choose a new job or a new insurer. In the past, small businesses often refused to hire workers at high risk of illness because their medical bills would drive up the cost of insurance for everyone in the company. And people who did switch jobs or insurance companies found that they had to wait up to 11 months for their new insurer to cover any bills for a pre-existing medical problem. “People who were locked in their jobs with small employers and couldn’t find similar employment are now free to move without suffering a loss of health coverage,” said Mark Scherzer, a lawyer in Manhattan who specializes in health law. “For small groups, there’s a lot more options.” One of Mr. Scherzer’s clients, for instance, said that because she had been treated for cancer, she had been afraid to leave her fund-raising job and look for work somewhere else. “This law gives me real options,” said the woman, who asked that her name not be used because she didn’t want prospective employers to know her medical history. “I certainly didn’t want to stay in my old job forever, but I had the horrible feeling that I had hit a wall. I was trapped.” Help for Empire The law was also intended to help bolster the fragile position of Empire, the state’s largest insurer, which had for years suffered as its healthiest subscribers were lured away by the commercial companies’ lower rates. More : query.nytimes.com |