John Stossel on Insurance

[Sam]

As it stands now, very few states allow the insurance company to break down group premium into different numbers, based on age. Usually, there is one premium per employee, and it is uniform, weather they are young or old.

In a few states, they list a different premium for each employee.

The benefit is that when the young people on a group policy are not subsidizing the old ones, you get a better selection, and the adverse impact is minimized.

The downside is, employers who pay a healthy share of the costs may try to hire younger people, so as to minimize the premium impact.

If the companies start underwriting individually, it is going to be very difficult to not hire someone who has diabetes, because it is a discrimination lawsuit waiting to happen.

 

[policy doctor]

Just sharing what I heard. Sketchy details, I admit. But this is a test program now...so there is some kind of loophole. Just wanted you folks to be alerted.....because if successful this will spread. Even our C. Howard, consumer advocate, is nervous about this. And laws have variances, or can be changed.

 

[arnguy]

In PA, until about 3 years ago, the small group market was community rated by BX. Then they started to base the rates on the group age, zip code, etc. I believe that groups of 100+ are still community rated.