Last night, a pro-consumer bill we strongly supported died in the Washington State Senate as lawmakers missed an opportunity to improve protections for families and small businesses struggling with rising premiums.
The bill (SSB 5247) would have required the Insurance Commissioner to consider nonprofit health insurance companies’ surplus when deciding whether premiums are reasonable for individuals and small businesses. Surplus is the money that non-profit insurers stock away on top of the reserves they need to make sure they can cover medical bills.
But the state’s three major nonprofit health insurers – Regence Blue Shield, Premera Blue Cross and Group Health Cooperative – together have more than $2.4 billion in surplus.
Endorsing the bill, the Seattle Times editorial board noted that “during the past six years, in which surpluses have swelled, rates in the individual market have more than doubled.”
Although WA Insurance Commissioner Mike Kreidler has the authority to deny rate hikes, without this bill surplus cannot be a factor in the decision. In an op-ed earlier this month, Kreidler pushed for the bill noting that these non-profit carriers hold surplus amounts “above and beyond what they expect to ever pay out in claims.”
“For years, insurance companies have been able to raise premiums while sitting on huge cushions of cash,” said Laurie Sobel, senior staff attorney for Consumers Union, the policy and advocacy division of Consumer Reports. “The Senate’s lack of action will allow this practice to continue.”
Washington consumers will not be given the same protection as consumers in other states. Insurance Commissioners in Oregon, New York and Colorado, have been able to better protect consumers from unreasonable rate increases.
We’ve fought for this bill in two-legislative sessions now and just this week had the help of more than 2,000 Washingtonians in asking Senators for their support. You can trust we’ll be fighting for the bill again next year.