The Boston Globe reports:
Thousands of consumers are gaming Massachusetts’ 2006 health insurance law by buying insurance when they need to cover pricey medical care, such as fertility treatments and knee surgery, and then swiftly dropping coverage, a practice that insurance executives say is driving up costs for other people and small businesses. …
The typical monthly premium for these short-term members was $400, but their average claims exceeded $2,200 per month. The previous year, the company’s data show it had even more high-spending, short-term members.
This is yet another example of how controls beget controls. Shall we expect this nationally with ObamaCare? The Globe article continues:
the phenomenon is likely to be repeated on a grander scale when the new national health care law begins requiring most people to have insurance in 2014, unless federal regulators craft regulations to avoid the pitfall.
Massachusetts law requires insurers to provide coverage to all applicants, regardless of pre-existing conditions. It also has what the Kaiser Family Foundation calls “adjusted community rating“: “means premiums can not vary based on health status but may be adjusted based on other factors.”
It’s no wonder people wait until they expect medical expenses to buy insurance. The Globe article says that Massachusetts governor Deval Patrick
filed legislation [that would] bring back the rule allowing insurers to exclude coverage for preexisting conditions for six months, or impose a similar waiting period under certain conditions for people buying coverage on their own. However, the new national legislation prohibits insurers from denying coverage based on preexisting conditions as of 2014, and will allow only a three-month waiting period.
“Bring back the rule”? How about removing a rule? Indeed, the governor wants to add rules:
Governor Deval Patrick recently filed legislation that state regulators believe will help fix the problem, by restricting insurance enrollment to twice a year for people who buy on the open market and allowing waiting periods before coverage kicks in.
This follows the standard recipe for destroying freedom: pass legislation, wait for harmful effects, and then pass more.
(Via Jon Caldara)
