New Report Shows Senate Bill Would Increase Healthcare Costs For Louisianians

October 14, 2009

BATON ROUGE - The healthcare reform bill passed by the Senate Finance Committee yesterday includes provisions that will make healthcare less affordable for most people in Louisiana, according to a newly released report.

The report, released by Oliver Wyman's Actuarial and Health and Life Sciences, is the only study of its kind because it's based on a database of actual claims, premium and underwriting information representing a total of 5.8 million covered lives.

The Senate Finance Committee provisions include:

• a weak individual mandate that will discourage people from buying insurance until they are sick
• tens of millions of dollars in new insurer fees that will be passed on to consumers
• tight limits on age rating that penalize the youngest one-third of the population
• high minimum benefit levels beyond what most people currently buy

The Wyman report, which can be downloaded at www.bcbsla.com/reform, takes into account all of the major components of the Senate Finance Committee bill that increase or decrease costs.  It does not "cherry-pick" certain provisions in the bill.

The Wyman report shows the average impact on healthcare premiums for Louisiana consumers if the current Senate Finance Committee bill were enacted.

• Individuals purchasing new coverage would see $3,237 in added costs for a family policy.  A typical family with a current average premium of $6,394 would be paying $9,631 in Year 5 of reform.
• Employees of small businesses purchasing new coverage would see $1,656 in added costs for a family policy.  A typical family with a current average premium of $10,621 would be paying $12,278 in Year 5 of reform.
• Even individuals with existing coverage would see their premiums go up due to the proposed new taxes.  An individual policy would see $122 in added costs, and a family policy, $488.

"We have supported healthcare reform for a long time," said Blue Cross and Blue Shield of Louisiana President and CEO Mike Reitz.  "We support the kind of reform that reduces costs and improves quality and access to healthcare.  We want to see meaningful healthcare reform legislation enacted this year.  But we are concerned that certain provisions in the current Senate Finance Committee bill will actually increase healthcare costs and decrease the choices consumers have in coverage plans."

For inquiries on the report methodology or findings from Oliver Wyman, please contact Patrick Clinton at 212.345.3013 or 973.901.5557, or e-mail patrick.clinton@oliverwyman.com.

About Blue Cross and Blue Shield of Louisiana
Celebrating its 75th anniversary in 2009, Blue Cross and Blue Shield of Louisiana (BCBSLA) is the oldest and largest Louisiana-based health insurance company.  BCBSLA is a not-for-profit, fully taxed mutual insurer, owned by policyholders and governed by a local Board of Directors.  It is an independent licensee of the Blue Cross and Blue Shield Association.

The company provides group and individual health insurance plans, life and disability insurance, group voluntary products and administrative services to more than 1.1 million members.  With headquarters in Baton Rouge and eight district offices, Blue Cross and Blue Shield of Louisiana employs more than 1,700 Louisianians who are committed to improving the lives of its customers by providing them with health guidance and affordable access to quality care. Learn more on the company's website at www.bcbsla.com.