Health insurance companies are requesting rate increases of 40% or more. I’m old enough to remember when businesses didn’t have to request the government’s permission to increase prices. They just raised prices as they wished, without getting the approval of a political commissar or a five-year planning board! However, in those days, we had more of a free market, so if a company raised prices too high, its sales went down as customers went to lower-priced competitors. There actually was a natural check on higher prices that didn’t involve government intervention. The free market setting prices – that sounds so weird and old-fashioned now, doesn’t it?
But anyway, insurers are requesting increases of up to 40% or more.
Blue Cross and Blue Shield plans — market leaders in many states — are seeking rate increases that average 23 percent in Illinois, 25 percent in North Carolina, 31 percent in Oklahoma, 36 percent in Tennessee and 54 percent in Minnesota, according to documents posted online by the federal government and state insurance commissioners and interviews with insurance executives.
In their submissions to federal and state regulators, insurers cite several reasons for big rate increases. These include the needs of consumers, some of whom were previously uninsured; the high cost of specialty drugs; and a policy adopted by the Obama administration in late 2013 that allowed some people to keep insurance that did not meet new federal standards.