Comments on: The Affordability Of Individual Health Insurance

By: Jay

Jay — Fri, 12 Dec 2008 21:26:57 +0000

@Don Levit: That is their plan. Insurance companies don't profit as well if they keep marketing a pool forever. It's a better game to discontinue blocks then start new blocks in order to continually trap the people that have been diagnosed with health conditions since signing up. They can't go anywhere, but the healthy people can. In time, their premiums will be the only $$ paying for their claims and you can offer the new policy blocks at a lower price. Keeping insureds for the long term is not the business model used.

By: Don Levit

Don Levit — Fri, 12 Dec 2008 16:37:01 +0000

Jay:
That would make sense.
It seems like Blue Cross is properly anticipating what will happen in a closed block of business.
With no new, healthy blood entering the closed block, there are no additional premiums to help subsidize those experiencing claims.
If my synagogue disallowed new members, it would be wise to start raising dues, if simlar services were provided.
Don Levit

By: Jay

Jay — Fri, 12 Dec 2008 01:29:03 +0000

@Don Levit: It appears the larger rate increases are only on the closed blocks.

By: Don Levit

Don Levit — Wed, 03 Dec 2008 15:35:11 +0000

Jay:
How were you able to discern this information?
Did Blue Cross provide the material, or did you have to do some investigative work?
Are these premium increases for renewals on the closed blocks?
If so, how does this compare to renewal premiums on the blocks that are still open?
Don Levit

By: justin

justin — Wed, 03 Dec 2008 08:56:54 +0000

I think you jinxed those people with cancer on the blue preferred plans.

By: Jay

Jay — Tue, 02 Dec 2008 21:17:59 +0000

Well, it turns out Anthem Blue Cross is sunsetting half of the Blue Preferred plans, all of the Right Plan 40 plans, all of the HIA plans, and half of the HSA plans. Some Anthem Blue Cross clients are seeing rate increases of more than 50%.

By: Jay

Jay — Wed, 19 Nov 2008 00:14:48 +0000

@Don Levit: I consulted Google and confirmed that was a compliment, thanks! And yes, good point. Anthem Blue Cross introduces new plans like Smart Sense, Tonik, etc, so that will dilute the number of people signing up for legacy plans still being sold, like the Blue Preferred PPO. And, I can't be sure they won't be sunsetting plans in the future (I wonder if they could guarantee that - I'll ask). It's just that I haven't seen them do it yet. A couple years ago they switched from their own HSA product to the better "Lumenos HSA," they let everybody with the old HSA switch to Lumenos with no underwriting. But atleast somebody who signed up for a Blue Preferred plan in 2001 and got stuck on it because of a cancer diagnosis in 2002 isn't sitting there in a pool with NO new applicants and only people who are healthy leaving the pool.

By: Don Levit

Don Levit — Tue, 18 Nov 2008 21:42:24 +0000

@Jay:
You are a mensch (that is a compliment)!
Very few agents will go to the lengths you do, that look at the fine print, in order to better serve his clients.

Anthem Blue Cross continues to accept new applicants.
I am curious if the stream of new applicants dwindles, in favor of the newer, possibly more popular plans?

Or, might the benefits change, or the network not be as extensive?
Is it usually, then, not beneficial for those who want long-term protection to switch from Anthem?

Don Levit

By: Jay

Jay — Tue, 18 Nov 2008 21:24:22 +0000

@Don Levit: That is a good point you make and it is addressed in our FAQ page with this question. Basically, what it says is that Anthem Blue Cross, Humana, and Kaiser are the only companies that don't penalize those that have been on a plan for years by having different rates. But there is more to that, and it is addressed HERE. Basically, what that says is that Anthem Blue Cross is the only company we've seen that hasn't yet practiced "sunsetting" of plans leaving a pool of people with a certain plan without any new people coming onto it. @Insurance: All links in the comments are automatically tagged with "rel=nofollow" - so continually leaving worthless comments does you no good.

By: Don Levit

Don Levit — Tue, 18 Nov 2008 19:53:07 +0000

@Insurance: good point.
In Texas, this needs to be done every 3-5 years in order to obtain the “new customer’s” discount.
Where is the security of equitable premiums after the serious illness develops?
Don Levit