Empire Blue Cross Blue Shield, the largest health insurer in the region, announced to health insurance brokers on Friday that it will eliminate most of its small group plans in the New York market effective April 1, 2012, and is slashing its financial incentives for brokers to sell those products—a move one industry insider has said would be “catastrophic” for the insurance marketplace.
...Empire’s statement says the insurer is sensitive to the economic challenges facing small businesses and its goal is to offer affordable health insurance plans to New York’s small businesses, but that it has had financial losses in the small group business that it called unsustainable.
...Officers of New York State Association of Health Underwriters sent a letter—of which Mr. Hasday was one of the signers—dated November 2, addressed to the superintendent of the State Department of Financial Services, stating concerns that a major carrier, which it did not mention by name, is withdrawing from the small group market because of rate request denials/reductions in the last five consecutive quarters. Mr. Hasday later confirmed that the letter referred to Empire.
“The major carrier’s pending withdrawal from the small group market is nothing short of catastrophic to small employers in the state ... tens of thousands of employees are going to be left without coverage, as there will be only two to three other carriers left in which brokers may try to place coverage. If the other carriers follow suit, the availability of coverage will dry up entirely.”
Empire is dropping coverage for two reasons, both of which will apply to Obamacare:
• All "insurance companies [must] get approval from the State Insurance Department before changing any rates."
• An "insurance company could only spend a certain percentage of premiums for non-claim costs."
Both of these strictures represent price controls that will drive insurers out of business. This is just one more exhibit demonstrating that Obamacare will be a complete and utter disaster for Americans.
We are on the road to single-payer health care, a system in which government controls your health care; in which it rewards friends and punishes enemies; and in which it rations care for those deemed too expensive.
The oldest and youngest Americans, the handicapped, and those most in need of health care are certain to suffer. Which is the whole point of government-run health care: total control of human lives by the ruling class.
Hat tip: Mark Levin.