Insurance Rates Jump 39% In California

For months now, the Republicans have been trying to tell Americans that there is nothing wrong with our health care system that some minor reforms (like abolishing pre-existing conditions) wouldn't fix. They have gone out of their way to defend the private insurance companies and protect their massive profits at the expense of consumers.

So how do the insurance companies react to this fealty from the Republicans. Well, if you are Anthem Blue Cross of California, you raise rates for most of your consumers by 30-39% for the second year in a row. This is pure greed based on their belief that real health care reform is now dead and they don't have to worry about it anymore.

If this was a company in trouble that was losing money it might be different, but the parent company of this insurance carrier earned 8 times their normal profit in the last three months of last year. This company just decided to go for even larger profits and screw most of their 800,000 California customers out of their hard-earned money. You can bet if they get away with this, other companies will do the same and it will quickly spread to other states.

This is what progressives and Democrats have been trying to tell Americans for over a year now. These private insurance companies are not in business to see that Americans get good health care at a reasonable price. They are only interested in ever greater profits. That's why we must remove the profit motive from health care, and the best way to do that is with public single-payer health insurance.

Secretary of Health and Human Services has written Anthem Blue Cross demanding an explanation of the ridiculous rise in premiums. Here's what she had to say to the company:

"With so many families already affected by rising costs, I was very disturbed to learn through media accounts that Anthem Blue Cross plans to raise premiums for its California customers by as much as 39%."

"These extraordinary increases are up to 15 times faster than inflation and threaten to make health care unaffordable for hundreds of thousands of Californians, many of whom are already struggling to make ends meet in a difficult economy."

"I believe Anthem Blue Cross has a responsibility to provide a detailed justification for these rate increases to the public. Additionally, you should make public information on the percent of your individual market premiums that is used for medical care versus the percent that is used for administrative costs."

"Policyholders in the individual market deserve to know if their premium increases would be invested in better medical care or insurance company overhead costs like salaries, profits, and advertising. I am aware that the state of California is investigating this matter, and urge Anthem Blue Cross to cooperate fully. In the meantime, I will be closely monitoring the situation."

"At a time when health care costs are a critical threat to families as well as the nation's economy, I hope you appreciate the urgent nature of this request. I look forward to your prompt reply."

That's a great letter, but I doubt it will accomplish anything such as lowering the rates. In fact, I would be surprised if she even gets a response from the company. The government needs to pass some real health care reform before the private insurance companies price everyone but the rich out of the market (and that probably won't be long).