OPINION:
In his May 6 Commentary column, “Competition beats regulation,” writer Rexford E. Santerre rightly suggested that the new health care law’s requirement that insurers spend a certain percentage of their premiums on medical claims won’t do much to rein in health costs.
Reams of evidence prove that medical loss ratios actually drive insurance prices up. A 2006 PricewaterhouseCoopers study, for instance, found that people in states with such ratios face fewer insurance choices, less competition and higher premiums than their counterparts in states without them.
Further, medical loss ratios don’t have any impact on how much insurers spend on their beneficiaries’ care. A 2008 Rand Corp. study found that states without loss ratios spend the exact same percentage of premium dollars on medical care as those with such controls.
JANET TRAUTWEIN
Executive vice president and CEO
National Association of Health Underwriters
Arlington, Va.
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