More On Insurance Rates

An article today in the LA Times, says that the Anthem Blue Cross rate increase for California policy holders is being put on hold until May. But what I found interesting in the article is this statement:

"We have instructed the actuaries to review the rates with a fine-tooth comb to ensure they comply with state law that requires that 70 cents of every dollar in premiums is spent on medical benefits," Poizner said.

Poizner is the State Insurance Commissioner.

Notice how this statement is worded. "Requires that 70 cents of every dollar". He makes it sound like 70 cents is a lot. Well it is not. Want to compare it to Medicare? About 95 cents, that's NINETY-FIVE cents of every dollar is spent on medical benefits. Medicare spends almost 36% (that's THIRTY-SIX percent) more than is required by the state of California.

It sounds like the great state of California is more interested in the supporting the for-profit health insurance business than the people of California.