Blue Shield California increasing insurance rates 59%

Blue Shield of California insures hundreds of thousand customers. In Oct, the insurer announced three gradual rate increases that add up to 59 %. The state of California is not sure they believe Blue Shield, who claims that an auditor found the boost in expense "reasonable."

California increase in rate

An announcement was made by Blue Shield of California in October 2010. It said insurance costs would be going up. The health care cost increase is what caused these increases, the insurer said. The insurer also says that more people are dropping health insurance, so prices need to be increased. On October 1, the first increase hit with two more, on January 1 and March 1, to come. For more than 100,000 customers, these three increases added up to a 59 percent increase in premiums.

Called a ‘reasonable’ increase happening

After the State of California and ratepayers raised severe concerns about the rate increases, Blue Shield of California employed an auditor. The state auditors and general public were able to see this report recently. Because of the increase of health care costs, in California especially, the audit states the 59 percent increase is "reasonable." About 80 percent of premiums have to be spent on health care for the customer which the health insurer is meeting according to the auditor. Information that the state auditors wanted wasn’t included in the audit though.

No chance of stopping the change

The insurance rate changes are reviewed and approved by the State of California. There isn’t anything regulators can do though. The state approval doesn’t really matter though. The rates can stick anyway. There is not a lot of motive to get the insurance increases changed. This is why the legislature for an emergency block of the increases probably will not occur. Customers are upset due to the health insurance bill. The rates have gone up, in part, because of this bill. Blue Shield of California explained that the reason for the hike in price is because individuals are leaving the system. This is due to the health insurance reforms.

Citations

Los Angeles Times

articles.latimes.com/2011/mar/01/business/la-fi-blue-shield-20110301

FL judge – medical care law violates constitution

The Affordable Care Act is unconstitutional, in accordance with a judge in FL. A lawsuit joined by attorney generals from twenty-six states has won the support of a second U.S. district court judge: Roger Vinson. The lawsuit zeros in on the so-called individual mandate, a section of the law specifying that all Americans over the age of 18 are required to obtain some form of medical insurance. This could require many American’s to take out pay day loans simply to cover this further costs in their life. Post resource – Florida judge rules entire health care law unconstitutional by MoneyBlogNewz.

How specific mandate brought the Commerce clause up

It was declared by United States District court Judge Vinson, who’s a Republican that Reagan appointed, the Affordable Care Act be thrown out within the ruling the health care law is unconstitutional. The specific mandate is something Vinson believes needs to be taken out of there. He thinks that under the Commerce Clause within the United States Constitution, Congress overstepped boundaries. Another ruling was made comparable to this. The judge in Virginia cited the Commerce Clause as well. Due to this, the health care law needs to be voided. This is what Vinson suggests. He said the individual mandate and the rest of the law are "inextricably bound together in purpose and must stand or fall as a single unit."

The Republican appeal strategy

Health care expenses for the uninsured add up to about $43 billion a year. Because the government is stuck with the bill, the Obama administration contends the specific mandate is legitimate regulation. The specific mandate is intended to make financing health care reform possible, opponents of the law are focusing on that provision. There were 13 attorneys general including 12 republicans and 1 democrat the Commerce Clause suit was done by. There have been 13 more Republican attorneys general that have joined up since then.

The constitution changes the way the medical care debates go

The Center for American Progress, which is a liberal Washington think tank, explains the health care law is constitutional. Over 125 legal scholars signed a statement released on Jan 18 that states the law is constitutional as the individual mandate is a tax provision. It’s a fine according to opponents. Since Americans have to purchase medical health insurance or pay a penalty, it’s a tax, according to the CAP. The Supreme Court has upheld the broad power of Congress to tax in the interests of the general welfare of the nation for 200 years.

Articles cited

Bloomberg

bloomberg.com/news/2011-01-31/obama-health-care-reform-act-unconstitutional-judge-says-in-26-state-suit.html

Miami Herald

miamiherald.com/2011/01/18/2022545_p2/more-states-join-florida-lawsuit.html

ABC News

blogs.abcnews.com/thenote/2011/01/unconstitutional-federal-judge-rules-against-health-reform-invalidates-law-over-individual-mandate.html