Report blames 2 insurers for rise in health rates
By TODD ACKERMAN
Copyright 2009 Houston Chronicle
May 21, 2009, 7:27PM
Texas health insurance premiums rose nearly six times faster than wages between 2000 and 2007, thanks to two companies’ near-monopoly of the market, according to a new report.
The report, issued by an advocacy group supporting President Barack Obama’s health care reform plan, cites American Medical Association data showing Blue Cross Blue Shield and United Healthcare control 68 percent of the Texas market. The U.S. Justice Department says a share that high allows companies to raise rates and reduce options “with impunity.”
“This lack of competition is bankrupting working families and small businesses and depriving consumers of choice,” said Justin Berrier, a researcher who contributed to the report by Health Care for America Now, a national organization representing more 1,000 groups advocating health care reform. “The health insurance industry needs to work for consumers instead of shareholders.”
The report is an attempt to refute the argument that national health care would undermine marketplace competition. Its authors tout a public health insurance option as a way to make companies compete and bring down cost.
Ninety-four percent of insurance markets, Texas among them, fit the Justice Department’s definition of a “highly concentrated” market, according to the AMA. In the past 13 years, there have been more than 400 corporate mergers involving health insurers.
A spokeswoman for the Blue Cross Blue Shield Association said the rising premiums aren’t the result of a lack of competition.
“The issue isn’t the number of insurers, especially given there are an average of 27 per state,” said Kelly Miller. “The rise in premiums is the result of the rising cost of health care services and increased use by an aging population.” (...)
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