Leading Healthcare Reform Supporter Boasts Highest Insurance Rates in Southern California (Part 1 of 2)

by webadmin on June 19, 2013

KPR-thumb2One of the country’s most famous and influential healthcare organizations and a leader in healthcare reform implementation is under fire for what some critics are deeming an intentional strategy to keep the sick and uninsured out of their system, reports Chad Terhune for The Los Angeles Times.

Kaiser Permanente, based in California, has been one of healthcare reform’s strongest advocates. As we’ve written before, Kaiser Permanente has built its reputation on the future and driving innovation in patient care, often being lauded by experts as the model for running an efficient, streamlined organization under the standards of healthcare reform.

But even in the midst of the praise, it was becoming obvious that Kaiser was struggling to lower its costs, something we noted in a two-part March post.

Now that insurer rates in California have been unveiled for the public, there is no doubt that Kaiser “has the highest rates in Southern California and some other areas of the state, surpassing rivals such as Anthem Blue Cross and other smaller competitors,” Terhune reports.

He continues, “In one key barometer of rates, Kaiser has the most expensive premiums for a 40-year-old in Los Angeles, Orange, San Bernardino, and Riverside counties for a mid-level Silver plan. Statewide, the nonprofit company has the highest or second-highest premiums for a Silver plan in 12 of the 18 regions where it’s selling HMO policies in Covered California, the state market that opens for enrollment Oct. 1.

“Kaiser’s Silver plan premium for a 40-year-old in southern Los Angeles County is $325 per month, 34 percent higher than the cheapest policy in the area, from Health Net Inc., at $242.”

After all that Kaiser has done to promote healthcare reform, these rates are astonishing, to say the least, and are providing fodder for the healthcare giant’s sharpest critics.

USC health policy professor Glenn Melnick asserts, “They appear to be protecting themselves because the people signing up in the first year are likely to be the sickest ones.”

Steve Valentine of the Camden Group charges, “Kaiser has structured this so they don’t get a lot of the poorer and potentially sicker people. Some people have been unemployed and underemployed for years, and they may have a lot of healthcare needs. There could be a lot of pent-up demand, and Kaiser may be trying to dodge that bullet.”

Ignoring the poor is not a new charge against Kaiser. Consumer advocates have long asserted that the organization has deliberately built hospitals and medical offices in wealthier areas and strategically avoided those individuals on Medi-Cal. In response, Kaiser points to the 560,000 Medi-Cal or safety-net recipients its Oakland company cared for last year alone.

Is this a fair charge against Kaiser? We’ll take a closer look at this in our next post. In the meantime, what do you think? Is this Kaiser’s fault, or is this an inevitable result of healthcare reform?

-by Pete Fernbaugh

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