UPDATE Feb 10, 2011. I have started a new health insurance policy with Health Net to replace my overpriced Blue Shield plan. I researched health plans on ehealthinsurance.com and found one that offered nearly the same benefits as Blue Shield's but at half the price. Here's the basic comparison:
Blue Shield: $4000 deductible, no coinsurance, no dental/vision --- $115 (soon) / month
Health Net: $4500 deductible, no coinsurance, no dental/vision --- $65 / month.
Yeah. Blue Shield claims they are losing money in the individual health care market. I don't know what they are doing wrong, but it seems pretty bad. Force health insurance companies to compete by choosing the company with the best rate. It's the only way to keep them honest.
If you are concerned about this isssue, please sign the petition that I have started:
A few weeks ago, I received a 32-page booklet from my health insurer, Blue Shield of California, titled "updates to your health plan." Of course, the updates included higher premiums and less coverage. Today, I received another missive; this time just a two-page letter. Apparently, Blue Shield is so excited about raising rates, they have already issued another rate increase even before the original rate increase has gone into effect. The total premium increase will be a 55.5% increase within a three-month period and a 98% increase since I bought the individual policy in March 2009.
When I first bought health insurance with Blue Shield in March 2009, the policy cost $58. This is almost the least expensive health plan available from any company. It has a $4000 deductible, and I am in the second-cheapest age bracket: 19-29. I also bought a dental plan for an additional $18. At some point in late 2009 or early 2010, Blue Shield raised the health insurance premium to about $75.
The letter says that hospital costs went up 15%, and prescription drugs and physician costs went up 12% and 9%, respectively, in 2010. In addition, the letter states that only 2% of premiums contribute to Blue Shield's "net income". Therefore, they must raise my premium by over %55 in the next three months, not including the first rate increase they issued in early 2010 to cover their costs. Either their math is wrong, or I do not understand their definition of "net income."
In early December, Blue Shield sent me the booklet with the chart on the left. It says my premium should be $97, but by late December, Blue Shield had sent another letter and decided the plan should really cost $115. What changed between the first and last week of December? Payroll tax cut? I mean, hey, the government didn't give any sort of explicit tax cut for health insurance companies in this latest round of wild tax cuts, and so insurance companies just needed to step in and take what's rightfully theirs. You know, people will have more money in their pocket due to the payroll tax cut, so they can just send that extra money directly over to their favorite health insurance company. That seems fair.
If you are concerned about this issue, please sign the petition that I have started: