Last spring, Georgia’s insurance commissioner, however, requested leniency on behalf of Georgia’s insurance companies to phase in this provision over three years rather than implement it immediately. This request was a tremendous disservice to the Georgians currently insured through individual policies.

Georgia Watch, along with Georgians for a Healthy Future, asked the US Department of Health and Human Services to deny Georgia’s request. We issued public comments to HHS and we authored an issue brief made available to the public. Luckily, our voice was heard, and a middle ground was struck. The Insurance Commissioner’s Office can still phase in the MLR rules, but at a much faster rate, which is a benefit to all Georgia policyholders with individual insurance. 

Starting in 2012, insurance companies operating in Georgia’s individual market must meet the 80 percent target or provide rebates to their customers. If the new requirement were implemented today, these insurance companies would have to rebate the nearly 350,000 Georgia customers enrolled in their health plans a total of about $42.6 million, or a little more than $100 per customer, on average.

The insurance commissioner’s office did not make an adequate case that the MLR adjustment should be granted. If insurance companies offering low-value, poor quality plans to consumers don’t meet the standard, they should be required to rebate their policyholders, and not receive a free pass. Read our comments here, and read the issue brief here.

It will soon be cheaper and easier for Georgians to enroll in the federal high-risk insurance plans that provide crucial coverage to those with pre-existing conditions. In an effort to spark enrollment in this key provision of the Affordable Care Act, Health and Human Services officials announced Monday that premiums in Georgia will drop by 15.5 percent. Additionally, consumers will no longer need to provide a rejection letter from private insurers, as previously required.

“We are hopeful that these lower rates and easier application process will help more Georgians receive the coverage they need and deserve,” said Georgia Watch Hospital Accountability Project Director Holly Lang.

Currently, only about 515 Georgians are enrolled in the pre-existing condition plan, though it is estimated that more than 200,000 could benefit from these plans. Currently, monthly premiums range between $147 and $633, depending on your age and type of plan.

Georgia is one of 23 states whose high-risk pool is operated by the federal government. The high-risk pool is meant to help those with medical conditions have coverage until 2014, when insurance companies will no long be able to deny coverage or charge higher rates.

To be eligible for these plans, applicants have to have been uninsured for at least six months and have to have a documented pre-existing condition that is proven by a doctor’s note. The lowered premiums will go into effect July 01, 2011. To learn more, visit GaHAP.org or PCIP.gov.

For more information, go to the Georgia Hospitial Accountability Project website by clicking here.

Georgia’s legislative women’s caucus will again crowd the walls of the Senate in protest of a bill poised to strip essential coverage from health insurance, coverage that helps protect Georgia women.

House Bill 47, which was introduced by Representative Matt Ramsey (R-Peachtree City), would allow insurance companies to sell individual health insurance plans in Georgia that don’t include the basic consumer protections and minimum medical benefits that are currently required by Georgia law, as long as the insurance policy is offered in another state.

The bill is expected to be heard on the Senate floor today. A similar measure passed the House in 2010, but was held up in the Senate after concerns were raised about a lack of coverage for key women’s health screenings.

“This is a bill for insurance companies, not consumers, as only the industry will truly benefit,” said Holly Lang, Hospital Accountability Project Director at Georgia Watch, a consumer advocacy organization. “This bill undermines the basic coverage guaranteed to us by previous lawmakers, and leaves our state’s consumers vulnerable to bare bones plans that do not provide essential coverage.”

All states differ in the services and supplies insurance companies must cover for their customers, and many states fall below Georgia in basic protections. For example, Idaho only requires insurance companies to include 13 basic services, and those do not include screenings for colorectal, cervical or ovarian cancer.

“While we applaud the effort to reform the individual health insurance marketplace, which all too often functions poorly for consumers, we are very concerned about the approach taken in this bill,” said Cindy Zeldin, executive director of Georgians for a Healthy Future. “This bill would have the effect of underinsuring Georgia’s health care consumers without adequately addressing our high rates of uninsurance.”

Generally speaking, benefit mandates provide crucial protection for consumers that face particular health challenges – those with chronic conditions, such as diabetes, and women. Women are disproportionately affected by HB 47, as Georgia currently requires in-state policies to cover vital services such as mammograms, certain cancer screenings and mastectomies.

Many states do not, and if those plans were allowed to be sold in Georgia, women’s care could fall to the wayside.

The bill will be heard on the Senate floor this afternoon, April 12.

Millions of Americans are falling for it, including the relatives of fallen service men and women. Military personnel are told their families will receive a $400,000 life insurance payout if they perish. But instead of a lump sum, grieving relatives are receiving what appears to be a checkbook, along with a letter telling them they can take their time withdrawing the money. It’s part of a widespread practice netting life insurance companies hundreds of millions in profit.

According to a recent Bloomberg report, life insurance companies are holding out on paying death benefits to family members so they can reinvest the money and make a profit on it. The insurance companies tell relatives that they’ll keep the money for safekeeping and apply a small amount of interest – usually .5 percent – on the sum. Relatives of the
deceased are issued a “checkbook” by the insurance companies, giving the impression that the money is being kept in a bank. It’s not. The money is being funneled into their own corporate investment accounts, which can return up to 5 percent interest. That means these insurance companies are making 5 to 10 times the amount eventually paid to families. What’s more alarming is that while the payout is in the hands of the insurance company, the money is not FDIC insured, meaning that if the insurance company happens to go bankrupt,
the money is lost permamently.

“It’s a rip off,” says Georgia Watch deputy director Danny Orrock. “The insurer gets to gamble on Wall Street with the beneficiary’s money. Unlike if the money were being held in a bank, the money in the account belongs to the insurer, not the account holder. So the company gets to play the market while the grieving family bears all the risk.”

There are reportedly more than a million of these accounts holding more than $28 billion in death benefits. Metlife alone holds $10 billion. While Prudential and Metlife were the focus of the Bloomberg report, more than 100 insurance companies have similar “checkbook” programs.

Georgia Watch urges public officials to wake up and fix this sleazy business practice.

Georgia Watch’s Insurance Company Accountability Network, or I-CAN, provides indispensable tips, warnings and other step-by-step information on how to shop smart for policies, research what kind of coverage you need, and hold insurance companies to their part of the deal when you run into trouble and need to file a claim.

When dealing with insurance, even the bold print reads like fine print. I-CAN helps put the complex practices of insurance companies into everyday language – so consumers can stand up for their best interests when dealing with their insurers.

Even worse, when insurance companies made empty promises to lower premiums if Georgia lawmakers passed “tort reforms,” doctors jumped on board too.

Too bad they didn’t look at the facts about California: The first state to pass “tort reform” in 1975.

Consider these numbers compiled by California’s Foundation for Taxpayer and Consumer Rights:

* 450%: Percentage that California doctors’ premiums rose in the 13 years after that state enacted a $250,000 cap on damages.
* 20%: Percentage that California’s doctors’ premiums declined in the three years after that state enacted Proposition 103 – a sweeping reform package that forces insurers to justify their rate increases under the scrutiny of consumers and the Insurance Commissioner.
* $1.2 Billion: Amount that insurers have refunded to doctors and other consumers since California voters enacted Proposition 103 in 1988.
* $891,000: Amount that the $250,000 cap in 1975 would be worth today.

And doctors are only one of many consumer groups that have benefited from California’s model oversight of insurance companies.

* 25%: Percentage that California drivers saw their auto insurance premiums DECREASE between 1989 and 2000.
* 26%: Percentage that drivers in the rest of the country saw their auto insurance INCREASE during the same period.

The success of strong oversight of insurance companies preying on “captive markets” such as doctors and drivers is not limited to California.

In the State of Washington, doctors lobbied for years for barriers to justice for victims of medical negligence, including a “cap” on jury awards for injured patients and their families.

But “the state’s doctors may have found a legitimate way to cut medical malpractice premiums: Get their malpractice insurance company to quit gouging them,” writes Seattle Post Intelligencer columnist Thomas Shapely.

In March 2005, Washington’s Insurance Commissioner announced that Physicians Insurance would have to refund more than $1.3 million plus interest in excess premiums charged in 2003. The company chalked up the overcharges to a “paperwork error.”

But insurance companies have made a stunning comeback. The property casualty insurance industry posted a 900% increase in profits in 2003 over 2002, according to the industry’s national association. In dollar figures, this record-breaking profit for the industry means that, nationally, insurers made $29 billion in 2003 – nearly 10 times the $3 billion profit they posted in 2002.

The property casualty insurance industry includes auto insurers and companies that sell malpractice insurance to health care providers, such as MAG Mutual.

But wait, there’s more! Weiss Ratings Inc. – an independent research firm that rates the fiscal health insurance companies – reported this week that the nation’s property casualty insurance companies reported profits of $28.1 billion in the first nine months of 2004 – a 22 percent increase over the same period in 2003.

Despite these huge gains, Georgia consumers have yet to see a drop in their premiums to match the high dollars that insurance executives are pocketing.

Georgia Watch has called for a full-accounting of insurance industry profits, and real reform that will hold insurers accountable to Georgia consumers.

Industry analyst A.M. Best Co. confirms that property casualty insurance companies – including medical liability insurers and auto insurers – raked in a record $41 billion in earnings in 2004. P & C companies were “in the black” even before counting their earnings from investments in bonds and the stock market – for the first time since 1978.

This new profit data comes on the heels of yet another year of runaway earnings in 2003, when the industry posted a $29.88 billion profit – a 900% increase over 2002 earnings.

Even worse, A.M. Best Co. attributes this profit explosion to years of insurance companies raising rates on consumers, then cutting back on their coverage and benefits. You – the customer – are paying the price out of your own pocket.

Individuals and business owners have no choice but to pay higher premiums for less coverage because many lines of insurance – including medical liability insurance – is regulated under a loose system of review called “file-and-use.”