California Health Insurance Information and News

Today shares of Aetna dropped 20% in the stock market. Shares of other insurance companies were also lower today and have been falling during the past month. Specifically, Wellpoint (parent company of Blue Cross of California), UnitedHealth (Parent of Pacificare of California), and HealthNet have all been losing value on the New York Stock market. (Blue Shield of California and Kaiser Permanente are not-for-profit health insurance companies and are not publicly traded on the stock market.)

Experts point to the rising cost of medical care coupled with the inability to raise premiums as the reason for the reduction in price for Aetna. The other medical insurance companies have been hurt by a reduction in membership or rates of growth in membership. Stock market analysts fear that health insurance companies may be forced to lower prices in order to attract new members. Lower prices or premiums with rising medical costs would shrink the margin (i.e., profit) of medical plans.

While this may not bode well for share holders of medical insurance companies, it could mean that we are on the verge of a much needed reduction in health insurance premiums.

Aetna Health Plan of California recently announced that they will change the benefits on their 2100 deductible High Deductible Health Savings Account compatible health insurance plan.

Currently this plan generally pays 100 percent of medical expenses after the $2,100 deductible has been met.

Effective April 1, 2006 this plan will only pay 80 percent of medical expenses after the deductible. When the member’s 20 percent copayment totals $3,000 (including the deductible) then the health insurance plan will generally pay 100 percent of medical expenses. So, this is a reduction of benefits.

This Aetna medical insurance plan is unique in that it offers an “embedded deductible” which means that when one member of a family satisfies the deductible then the insurance company begins to pay for medical expenses.

Most other HSA compatible health insurance plans have an “aggregate” deductible where all members of a family contribute to a single deductible.

For additional information and quotes on California small business group health insurance plans click here or call our helpful, fully licensed staff at 800-746-0045.

Blue Cross of California is raising rates approximately 15 percent for their small group clients effective May 1, 2006. This “focal renewal” effects small group health insurance clients who initially began their Blue Cross medical plan prior to 12/1/2003.

Blue Cross of California is not changing benefits such as co-pays, deductibles, out of pocket maximums or prescription medicine benefits. Essentially, only rates are changing. Some clients with a large number of employees and dependents enrolled in a Blue Cross health plan who have not had major medical claims may receive a lower rate increase. Other groups with significant claims may receive a 20 to 25 percent rate increase. Blue Cross has historically changed rates on the focal renewal only once each year.

As you may expect, other insurance companies, e.g., Health Net of California, Pacificare of California, Blue Shield of California, Aetna and others are offering discounts in an attempt to lure customers away from Blue Cross. Click here if you would like to obtain a quote for small group health insurance in California or call the helpful, fully licensed staff at BenefitsCafe.com at (800)746-0045.