With individual health insurance premiums soaring in Washington state, its insurance commissioner is backing legislation requiring all plans operating in the state to offer individual coverage.
The measure is necessary because the insurance market is in crisis, said Commissioner Deborah Senn. Most insurers and HMOs that offer group coverage in Washington don't offer individual policies. Meanwhile, individual premiums rose as much as 34% this year.
The crisis was precipitated when state healthcare reform, launched in 1993, increased access to healthcare for hundreds of thousands of Washington residents. Access to the state's Basic Health Plan was broadened, and the law mandated insurance portability and restricted bans on pre-existing condition coverage.
Senn argues that the Legislature's repeal in 1955 of much of the reform law contributed to the insurance crunch. For example, one provision would have mandated community rating, which would have required carriers to spread their increased costs among all subscribers.
Now those increases are being borne by individual subscribers. That is why Senn said she supports legislation by state Sen. Kevin Quigley (D-Lake Stevens) that would require all carriers to participate in the individual market and prohibit them from raising individual rates more than 105% above those they offer businesses.
The law would protect all plans through reinsurance and would reimburse plans serving enrollees needing more than average care.
The cost of the program would be shared by all health insurers, including those that sell stop-loss coverage to self-funded employers.
HMOs such as Spokane-based Group Health Northwest, an affiliate of Group Health Cooperative of Puget Sound, oppose the legislation. GHCPS, based in Seattle, offers individual policies but believes "participation in the individual market should be voluntary," said Eric Petersen, special projects manager of Group Health Northwest.
"We know there are problems in the individual market, and we're participating with the (state's) Health Policy Board to see what the problem is," he said.
Carriers who write individual policies say they cost about 10% more than their premiums bring in, Petersen said.
But "we don't want to do surgery until we know what the patient's problem is," so the best thing to do is collect data and analyze it, he said. Only then, if necessary, should legislation be proposed, he said.
Meanwhile, a law effective Jan. 1 mandates that every health plan in the state include coverage for every category of licensed providers, including osteopaths and acupuncturists. Insurers have sued to overturn the law.