Two of Washington State’s biggest nonprofit health insurers have more than $1-billion in cash reserves, according to the state’s top insurance regulator, who is seeking authority to consider such surpluses in weighing proposed rate hikes, writes the Associated Press.
Premera Blue Cross and Regence BlueShield are “building up a financial cushion for themselves, and it comes at an expense for people,” Insurance Commissioner Mike Kreidler said Monday of data from the organizations’ latest financial filings. He noted that the cost of individual health policies in the state has more than doubled since 2005.
The insurers said they reserves are needed to ensure they can pay claims, guard against unforeseen costs, and invest in technology and other programs. Eric Earling, a Premera spokesman, said the surplus is also a critical bulwark against rising costs resulting from the federal health-care reform.
Mr. Kreidler has called for a state law to allow his office to take into account the size of insurers’ reserves in considering their requests to raise premiums. Eleven states, including neighboring Oregon, have adopted such laws, but the measure stalled last year in Washington without reaching a floor vote.