Universal Coverage Windfall

Sunday I wrote Universal Coverage Requires More Primary Care Physicians. An article yesterday points out Some Towns See Surprise Windfall.

"For the last several years, communities have struggled to find money, often because they've had to pay big increases in health insurance premiums for municipal employees. This year, as towns braced for premium hikes, many have found that the premiums are barely going up, and some have enough money left over to restore services they had to cut back last year. "

"So how did this windfall come about? Stephen O'Leary told his fellow Selectmen that Blue Cross Blue Shield barely raised premiums because, thanks to a new law, towns can join the state's health insurance plan, and Blue Cross wants to hang on to its municipal customers."

"Now that we've got this competition going on, which is a great thing, Blue Cross Blue Shield has said: "Oh, how about a two-and-a-half per cent increase?" whereas over the years, we've been talking about twelve and fifteen per cent increases. Municipalities and people in general have been gouged by these companies for years. Now that there's some competition out there, we're finally realizing some of the benefits of that. "

The article says BCBS denies it's about competition but also points out that many towns are seeing much lower premiums.