Health Insurers Tell Lawmakers They Will Curb Risk Rating

March 25, 2009 ( - In a letter to key senators, America's Health Insurance Plans and the Blue Cross and Blue Shield Association offered Tuesday for the first time to curb their practice of charging higher premiums to people with a history of medical problems.

According to the Associated Press, the two insurance industry groups said their members are willing to “phase out the practice of varying premiums based on health status in the individual market” if all Americans are required to get coverage. “The offer here is to transition away from risk rating,” said health economist Len Nichols of the New America Foundation public policy center, in the news report. “They have never in their history offered to give up risk rating.”

Senator Jeff Bingaman (D-New Mexico) said: “This letter demonstrates that insurance companies are open to major insurance reform, and are even willing to accept broad consumer protections.”

The AP said that insurers are trying to head off the creation of a government insurance plan that would compete with them. To try to win political support, the industry already has made a number of concessions, the AP noted. As an example, the news report said last year insurers offered to end the practice of denying coverage to sick people. They also said they would support a national goal of restraining cost increases.

However, the companies left themselves several outs in the letter. They said they would still charge different premiums based on such factors as age, place of residence, family size and benefits package. The insurers did not extend to small businesses their offer to stop charging the sick higher premiums.

“If the goal is to make health care affordable, this concession does not go far enough,” said Richard Kirsch, campaign manager for Health Care for America Now, in the news report. “It still allows insurers to charge much more if you are old.”