Governor Seeks More New York Health Insurance Regulations

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NY democrat Governor David Paterson, is looking for more regulation to control New York health insurance rates as critics say rate increases have driven too many New Yorkers to drop their plans. One of Paterson's proposals seeks to require New York health insurance providers to gain state approval for rate hikes. Insurance companies are currently able to set medical coverage rates without government control. Paterson, and others, say that needs to change.

The proposal would give power to the state's Insurance Superintendent, currently Eric Dinallo, to set insurance rates. Paterson, Dinallo and others insist that with a broad view, the government can set fair New York health insurance prices that won't disrupt the marketplace. The officials also claim this will bring down costs in the other arenas of health care, such as provider and administration costs.

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The New York Health Plan Association sees such proposals differently. The NYHPA argues that the proposal unfairly targets only the sector of New York health insurance in which they operate. Leslie Moran, spokeswoman for the association, notes the proposals make no mention of hospital and care-provider costs, a key indicator used by insurers to set rates.

Provider costs have risen faster than inflation in recent decades due to a number of reasons. New technology has helped drive up cost to some degree, though also helping to save lives. It is the threat of malpractice suits that is perhaps the single-most responsible reason for compounding health care costs in the United States. Regardless of the measures taken to control health care costs, without tort reform, costs will continue to escalate as providers are forced to pay higher and higher rates for malpractice insurance. This is an aspect that those seeking to reform New York health insurance fail to acknowledge.

A number of other proposals are also under consideration by the Paterson administration. Currently, most New York health insurance plans drop coverage for children at age 23. Paterson is seeking to raise the age of coverage for single children to 29. Concerning COBRA, Paterson is proposing coverage be extended from 18 months to 36. COBRA allows for those who have lost their jobs to have continuation coverage of the health insurance plan they had while employed.

Part of reforming New York health insurance will also involve reducing the time insurance companies have to pay providers. Governor Paterson wants to reduce this time from the current 45 days, down to 15. New York health insurance plans are set to undergo serious changes under these proposals. However, it remains to be seen how failing to address the costs of providers will effect reform.

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