Large health insurer surpluses could help ease premiums

The News Tribune of Tacoma and the Bellingham Herald this morning ran an op-ed column by Commissioner Kreidler, talking about the fact that -- under current law -- our rate reviews of health premiums have to ignore the billion-dollar surpluses that some non-profit health insurers are sitting on.

From the op-ed:

Two of this state’s largest insurers – Premera Blue Cross and Regence BlueShield – are sitting on surpluses totaling $2.2 billion. In fact, their surpluses grew almost a quarter-billion dollars in the first nine months of 2012 alone.


As the state’s insurance regulator, I review insurance premiums. If they’re unjustifiably high, I tell companies they cannot charge that much. This is a critical protection for Washington consumers.

But here’s the elephant in the room: Under current law, I am barred from taking those surpluses into account when I review rates. This is despite the fact that regulators in nearly a dozen other states, including Oregon, have the authority to do so.

We're seeking legislation -- House Bill 1349 -- that would allow us to take surplus into account when the rates are reviewed.

By factoring surpluses into rate reviews, I can help protect consumers from sticker shock in their health care premiums, while still ensuring that carriers are financially healthy. It would be a tragedy – both for the economy and for individuals – if lawmakers chose to put the interests of insurance companies ahead of their constituents.