Thursday, January 31, 2008

"Profit" is a Dirty Word; State of Washington to Control Prices

Categories: Insurance Regulation, Washington

Next time someone tells you that we need to complete the government takeover of health care because "the private market isn't working," consider the situation in the state of Washington.

After regulations destroyed the market for individual insurance policies, the state backed off its regulations a bit. Insurance companies came back. But now there's a hew and cry because premiums are up. (Not surprisingly, so are profits--but then again, where do companies get their reserves from?)

So what does the political class plan to do? Subject insurance companies to price controls.

Insurance Commissioner Mike Kreidler said it's time for transparency.
Kreidler said he requested the legislation because there's no way for him to tell the public if the rates are legitimate since he does not have access to the relevant company data.

"No way for him to tell the public if the rates are legitimate."

Sounds like price controls to me. So much for a private market. This one is, in large measure, government-controlled.