Thursday, January 12, 2012

Health Care Costs

Yesterday the NY Times Editorial praised the low rate of health care costs this year.

They stated:

The data show that total health care spending by public and private sources, including households, rose by 3.8 percent in 2009 and 3.9 percent in 2010. Spending slowed for hospital care, physician services, nursing homes, home care and especially prescription drugs, as consumers increasingly chose cheaper generics. Growth in spending by both Medicare and Medicaid actually slowed in 2010 compared with 2009, even though the federal government ramped up its share of the nation’s total health care spending while private businesses reduced their share. 

 Yet today HHS touts its use of the new act to dampen excessive Health Care costs. It states:


Health insurance premium increases in five states have been deemed “unreasonable” by the U.S. Department of Health and Human Services, ...After independent expert review, HHS determined that Trustmark Life Insurance Company has proposed unreasonable health insurance premium increases in five states—Alabama, Arizona, Pennsylvania, Virginia, and Wyoming.  The excessive rate hikes would affect nearly 10,000 residents across these five states. In these five states, Trustmark has raised rates by 13 percent.  For small businesses in Alabama and  Arizona, when combined with other rate hikes made over the last 12 months, rates have increased by 27.2 percent and 18.1 percent, respectively. In addition to the review of rate increases, many states have the authority to reject unreasonable premium increases.  Since the passage of the health care reform law, the number of states with this authority increased from 30 to 37, with several states extending existing “prior authority” to new markets. Examples of how states have used this authority include:
  • In New Mexico, the state insurance division denied a request from Presbyterian Healthcare for a 9.7 percent rate hike, lowering it to 4.7 percent;
  • In Connecticut, the state stopped Anthem Blue Cross Blue Shield, the state’s largest insurer, from hiking rates by a proposed 12.9 percent, instead limiting it to a 3.9 percent increase;
  • In Oregon, the state denied a proposed 22.1 percent rate hike by Regence, limiting it to 12.8 percent.
  • In New York, the state denied rate increases from Emblem, Oxford, and Aetna that averaged 12.7 percent, instead holding them to an 8.2 percent increase.
  • In Rhode Island, the state denied rate hikes from United Healthcare of New England ranging from 18 to 20.1 percent, instead seeing them cut to 9.6 to 10.6 percent.
  • In Pennsylvania, the state held Highmark to rate hikes ranging from 4.9 to 8.3 percent, down from 9.9 percent.
So which of the two comments is true. And a better question is why the difference.