The individual health insurance market reform bills are
now being reviewed by a bipartisan committee made up of
members of the House of Representatives and the Senate.
We encourage the committee to ensure the final bills contain
all of these much-needed consumer protections that will
help make health care coverage for individuals more affordable
and accessible. Michigan needs insurance reform that will:
- Cap rates and rate increases.
- Create a uniform, objective method for setting rates.
- Lower the waiting period for pre-existing conditions
to six months.
- Allow initial health condition to be used only when
a person applies for coverage for the first time, and
prohibit insurers from raising rates at renewal because
of a change in a person’s medical condition.
- Authorize the Insurance Commissioner to order refunds
for excessive rates.
- Require that Blue Cross Blue Shield of Michigan maintain
its insurer of last resort status.
- Establish a risk-spreading mechanism for high-risk
individuals, ensuring all carriers bear some responsibility
for the individuals they choose to reject.
Michigan deserves more consumer protection
Here is a brief overview to help you understand what these
reforms mean to the Michigan individual health insurance
market and its consumers.
Capping
rates, limiting rate increases
Michigan needs protection against high rates. Under the
current rules, for-profit insurers have virtually no limit
on how much they charge when people apply for coverage.
They can charge whatever they want. Reform legislation will
create fair, consistent pricing by putting a cap on the
amount an insurer can charge when people apply for coverage.
The reform
bills need to help people with high-risk conditions
For-profit insurers can deny health care coverage
for any reason, and typically they turn away 20 percent
to 30 percent of those who apply. In 35 other states, insurance
companies all contribute to a high-risk pool to help keep
coverage affordable, but in Michigan, health insurers get
a free ride. They simply deny coverage and walk away from
the people who need insurance the most.
We need to establish a risk-spreading mechanism for high-risk
individuals, ensuring all carriers bear some responsibility
for the individuals they choose to reject.
Contact your legislators and let them know more work is
needed on the individual market reform bills!
