I met with two different (unnamed) insurance executives last week who report feeling very, very worried indeed about their uncertain future (I know, a lot of you are getting your hankies out). But, remember recently when California insurance premiums for Wellpoint were going to go up by over 25% according to WellPoint, and everybody freaked out?

Well, the reality is insurance premiums are still going up pretty fast all over the country. Increases of 10-15% are likely to represent “good news.” In the individual and small business the 25% prediction was probably accurate. Liberal Dems will use this information and try and re-kindle interest in Medicare-for-all or at least a public option.

Embattled health insurer Anthem/Wellpoint is reviving its plan to raise rates for tens of thousands of California policyholders, some of whom could see their premiums rise as much as 20%, the Los Angeles Times reports. I think they really need to do this because of higher costs in the individual market. The insurers firmly believe that many small and middle sized businesses will watch premiums increase and then dump their employees into the insurance exchanges at the first opportunity, and the big for-profit health plans therefore think their future business will be limited to large employers, and/or to government contracts through private sector versions of Medicare and Medicaid like Medicare Advantage (MA). Of course, since MA is being hit up for $135 billion of cuts to help fund the health reform law (PPACA) MA plans will be scrambling for cost savings, and may be threatened..

Americans who have been denied coverage by an insurer because of a pre-existing health condition can now finally apply for insurance through high-risk insurance pools," the Wall Street Journal (subscription) reports. Will insurers help to make these pools succeed? Insurance rates should be easier to stabilize if high risk patients are in federal pools, but plans expect big rate hikes this year across the board.

You would think these trends would serve as a wake-up call for insurers to work with physicians realign payment incentives, and start reforming the system to ferret out waste and improve quality. I hope that happens, but thus far I’m seeing more ringing of hands and girding of loins than innovative action. Private insurers still don’t seem to get it. I’m hopeful they will (naïve).

Incidentally, if the insurers worried about premium increases and government regulation, the big employers are just as concerned. The Business Roundtable estimates the average insurance premium for an employee (plus dependents) in 2019 is likely to be well over $25,000 (oops), and that employer health care spending will at least double in this decade. In fact, employee salaries will be in bad shape (flat?) if health benefits don’t come under more control. Employers believe the solutions to these issues have to include:

• Individual accountability – meaning no “free riders” in the marketplace, and individuals need to come up with a larger share of health premium costs and to adopt some healthier behaviors
• Full transparency and public reporting of cost and quality information
• Reducing variation in practice patterns
• A real focus on health, not illness
• More investment in health IT adoption
• Supporting physicians to move to paying for value rather than volume, promoting quality and wellness, and working with patients in shared decision making toward reducing unnecessary things.

We’re on the same page. I think. I hope. Change needs to happen or we’re all in big trouble.

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