What do you guys think will happen if health insurance is able to be bought and sold over state lines and the anti-trust exemption is eliminated? Will this increase or decrease competition? Also do you think this will decrease premiums for consumers? Please post real world examples/comparisons/studies to back up your stance.
Health Insurance Across State Lines, Competition, and Premiums
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Re: Health Insurance Across State Lines, Competition, and Premium
Examples? It is currently prohibited.
It would quite simply raise rates in states where current premiums are low relative to claims.
Imagine that state A has low-cost plans because it has low population density, less restrictive mandates and claims are low. Now people from state B start buying plans from state A because they are so cheap. The reason they are buying from state A is because state B has already adjusted premiums to reflect accurate risk within the state.
The people from state B buying state A plans are going to have different claims experience than state A residents have had and, as such, since they went out for the lower cost, state A carriers will have to raise premiums to compensate for the claims coming in from state B.
Examples? It is currently prohibited.
It would quite simply raise rates in states where current premiums are low relative to claims.
Imagine that state A has low-cost plans because it has low population density, less restrictive mandates and claims are low. Now people from state B start buying plans from state A because they are so cheap. The reason they are buying from state A is because state B has already adjusted premiums to reflect accurate risk within the state.
The people from state B buying state A plans are going to have different claims experience than state A residents have had and, as such, since they went out for the lower cost, state A carriers will have to raise premiums to compensate for the claims coming in from state B.
- 990
Re: Health Insurance Across State Lines, Competition, and Premium
Flukester,
Wouldn't this interstate deal merely even out rates between different states?
OH would raise and Fl would go down for example? Course you have the C.P.I to consider but ...?
Flukester,
Wouldn't this interstate deal merely even out rates between different states?
OH would raise and Fl would go down for example? Course you have the C.P.I to consider but ...?
- 3,384
Re: Health Insurance Across State Lines, Competition, and Premium
In theory I guess it could reduce premiums in the B state with more people buying and increasing the premiums in A state. But, I would seriously doubt any carrier would reduce existing premiums even with good claims experience.
In theory I guess it could reduce premiums in the B state with more people buying and increasing the premiums in A state. But, I would seriously doubt any carrier would reduce existing premiums even with good claims experience.
Re: Health Insurance Across State Lines, Competition, and Premium
Under which set of rules is this discussion taking place? If you did this 'today', you would have to question things like:
- Which state laws would apply? For instance, can a state that allows riders write a policy in a state that is rate or decline?
- How would in network vs out of network work? Going across state lines, most things would be out of network.
Many, many other questions would start to come up.
If you look into the future, then you have to give an assumption of what you think the health insurance rules will be. For instance, do state DOI's even exist anymore? Is everything guaranteed issue? Are there underwritten plans that are not guaranteed issue, and presumed less expensive? Do riders still exist for anything?
Even my good crystal ball can't make an accurate prediction of the answer to this question.
Dan
Under which set of rules is this discussion taking place? If you did this 'today', you would have to question things like:
- Which state laws would apply? For instance, can a state that allows riders write a policy in a state that is rate or decline?
- How would in network vs out of network work? Going across state lines, most things would be out of network.
Many, many other questions would start to come up.
If you look into the future, then you have to give an assumption of what you think the health insurance rules will be. For instance, do state DOI's even exist anymore? Is everything guaranteed issue? Are there underwritten plans that are not guaranteed issue, and presumed less expensive? Do riders still exist for anything?
Even my good crystal ball can't make an accurate prediction of the answer to this question.
Dan
- 990
Re: Health Insurance Across State Lines, Competition, and Premium
Nonsensical. What about the area trend factor? Some places are more risky to live in. What do you have in OH? Maybe get run over by some Amish dude drive'n a horse and buggy?
Then you have Miami ...
Again, to me. All this wrangling amounts to the same thing.
Interstate, GI,subsidies, P. Option, exchange,etc.
Commission or no ...
It all goes to the same place. One step at a time they want Nation health for the masses. No middle class.
They want to get rid of private ins.
Nonsensical. What about the area trend factor? Some places are more risky to live in. What do you have in OH? Maybe get run over by some Amish dude drive'n a horse and buggy?
Then you have Miami ...
Again, to me. All this wrangling amounts to the same thing.
Interstate, GI,subsidies, P. Option, exchange,etc.
Commission or no ...
It all goes to the same place. One step at a time they want Nation health for the masses. No middle class.
They want to get rid of private ins.
- 4,096
Re: Health Insurance Across State Lines, Competition, and Premium
It would decrease rate big time in the current GI states.
It would also create some competition in all other states.
It would force people to look closer at their own state mandates.
There would be some real adjustment in coverages.
A physical at UCLA can cost about $1,700.
If you have a Indiana insurance contract it might only pay up to $800. So then the Cali. resident that bought a policy from Indiana is stuck with the $900. This example would be with a carrier that has a national network.
That insurance premium could be 30-40% less.
I am all for interstate health insurance.
It would decrease rate big time in the current GI states.
It would also create some competition in all other states.
It would force people to look closer at their own state mandates.
There would be some real adjustment in coverages.
A physical at UCLA can cost about $1,700.
If you have a Indiana insurance contract it might only pay up to $800. So then the Cali. resident that bought a policy from Indiana is stuck with the $900. This example would be with a carrier that has a national network.
That insurance premium could be 30-40% less.
I am all for interstate health insurance.
- 3,384
Re: Health Insurance Across State Lines, Competition, and Premium
We already saw what happens with Lumenos and multi-state small group within the last 2 years.
Plan rollout in 14 states, first focal 40% rate increase to cover "overutilization" of preventive benefits (which have a zero co-pay and are not subject to any deductible).
The example assumes that a cross-border plan has a cap on it for preventive services, office visits and physicals. A lot of HSA plans are designed to mirror Lumenos and are uncapped. If the Indiana plan is Lumenos, they are on the hook for the NFR with UCLA (which absolutely is a par provider), even if it is excessive by Indiana standards.
We already saw what happens with Lumenos and multi-state small group within the last 2 years.
Plan rollout in 14 states, first focal 40% rate increase to cover "overutilization" of preventive benefits (which have a zero co-pay and are not subject to any deductible).
The example assumes that a cross-border plan has a cap on it for preventive services, office visits and physicals. A lot of HSA plans are designed to mirror Lumenos and are uncapped. If the Indiana plan is Lumenos, they are on the hook for the NFR with UCLA (which absolutely is a par provider), even if it is excessive by Indiana standards.
Re: Health Insurance Across State Lines, Competition, and Premium
Buying across state lines is at best, a zero sum game. If someone buys across state lines because it is cheaper elsewhere, then either the rates go up in the state he bought in, accounting for the increased risk to that plan, or, the rates go up in the state he lives in, to account for adverse selection.
Basically, if you have a guaranteed issue state, all they will have is the high cost individuals, causing rates to skyrocket further. The 'pool' of healthy individuals that normally help offset the cost will simply buy from elsewhere.
At best, it's a zero sum game, which I think would be optimistic, dealing with the headaches and administrative affects of this will probably raise premiums slightly.
Individually, some would benefit, some would pay more. It would take several years for this to sort itself out.
Dan
Buying across state lines is at best, a zero sum game. If someone buys across state lines because it is cheaper elsewhere, then either the rates go up in the state he bought in, accounting for the increased risk to that plan, or, the rates go up in the state he lives in, to account for adverse selection.
Basically, if you have a guaranteed issue state, all they will have is the high cost individuals, causing rates to skyrocket further. The 'pool' of healthy individuals that normally help offset the cost will simply buy from elsewhere.
At best, it's a zero sum game, which I think would be optimistic, dealing with the headaches and administrative affects of this will probably raise premiums slightly.
Individually, some would benefit, some would pay more. It would take several years for this to sort itself out.
Dan
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