Washington State’s Insurance Commissioner is proposing legislation that would establish a so called “reinsurance” program he says will provide stability in the market, and lower individual premium costs.
The idea behind reinsurance is to allow insurance companies to remain solvent, by giving them partial reimbursement for high cost claims that exceed a certain threshold, like cancer cases.
Insurance Commissioner Mike Kreidler says the federal government was providing reinsurance to insurance companies providing coverage under the Affordable Care Act, until about a year ago. After it was discontinued, premium prices crept up:
“It was huge increase, we saw a jump of at least 10 percent in premiums, and that’s what we’re trying to recapture right now to get that lowered back down again, after the reinsurance program went away,” said Kreidler.
Now, bills have been proposed in both the house and senate to institute a state reinsurance program, at a cost of 200 million dollars:
“Now we are going to begin seeking a waiver from the federal government , which could cover 25 percent of that cost, something like 40 million dollars a year would come from the federal government from a waiver program,” Kreidler said.
At a hearing in the Senate Health and Long Term Care committee Tuesday, Patrick Conner, of the National Federation of Independent Business, said he worried that the plan will provide no real guarantees that health insurance will remain stable in the state:
“We get no guarantee that we will be fully covered in every county; no guarantee that health insurance costs will go down, the only guarantee is higher costs on the people this legislation claims to help,” said Conner.
Commissioner Kreidler believes the plan will lower average premiums by 10 percent, and ensure that every county in the state will have insurance providers.
