Investment Info

This February, the Department of Health and Human Resources has issued a report identifying an alarming trend for insurance companies to seek premium rate increases. This is not limited to one or two states. This is not limited to one or two percentage increases in the rates. This is all the leading insurance companies asking for the right to significantly higher premiums: in Michigan hikes of 56%, in California hikes of 39%, and so on. If this only affected small numbers of policyholders, it might have passed unnoticed. But, with millions of policyholders affected across the country, these rate increase requests have attracted the full scrutiny of the federal government. Secretary Sibelius has been leading the attack, using the requests to push the reform agenda forward.

Because of the national anger, some companies have paused. WellPoint had proposed the increases take effect from March 1. Any increases, even if approved by the states, will now be delayed until May at the earliest. This decision is partly in response to the summons of WellPoint’s chief executive officer to Washington to justify the requested increases. Insurance companies find themselves in a difficult political situation. Their management teams accept a duty to maximize profits for the benefit of the stockholders. They look around at an America seriously affected by the recession. Increasing numbers of people are unable to afford the premiums, some because of unemployment, others because of a squeeze on credit. More worrying from the insurance industry is that more healthy people are deciding not to insure at all. This means the group of people left holding policies has a higher percentage of those with existing health problems. Without more healthy people in the group paying premiums and not claiming, it becomes more expensive to insure those less healthy people who remain. It is also a verified fact that hospitals and healthcare service professionals have also been increasing their fees and charges. The pharmaceutical companies have increased the price of almost all the most commonly used drugs. The insurance industry is under pressure from both sides. As Secretary Sibelius points out, however, this is not a completely accurate picture. Every year, insurance companies are required to submit reports to all the US states in which they are licensed to sell policies. This data shows many companies actually increased the number of policyholders during 2009. Read the rest of this entry »

Health insurance market sure looks confusing to those who have to deal with it for the first time in their life. But as with anything that seems complicated at first, health insurance is quite easy to understand when you take some time to learn the basics of it. Of course, don’t expect to become an insurance market specialist overnight but the following tips will certainly help those inexperienced with health insurance shopping to get a decent policy for a fair price.

What you can get?

Individual insurance plans – the most common option for people with normal income, especially those who aren’t offered with group insurance by their employers. The vast majority of insurance companies offer such policies and the diversity of coverage options is very wide here. However, make sure to learn what are the requirements in your state and check if the insurance company is licensed in your area before getting the plan.

High risk pools – some pre-existing conditions will make it hard for you to get typical individual health insurance. That’s where high risk pools may come in handy. Such plans are available only in certain states, so make sure to learn if there are any in your area. If yes, then it would be a good option for those who are considered to be a high risk policy-holder. The rates are relatively high here, but for some it may be the only option for adequate coverage.

HIPAA coverage – this type of insurance best appeals to those who have been recently dropped of employer sponsored group coverage and don’t fall under COBRA coverage too. Health Insurance Portability and Accountability Act (also known as HIPAA) health insurance can be purchased in any state and is particularly useful to those who have pre-existing conditions. Thus, it’s a good alternative to high risk pools or an option where the pools are unavailable. Speak to your insurance agent to decide which option is better for you. Read the rest of this entry »