Selling health insurance across state lines

[YewNork]

Republicans keep pushing the idea of allowing health insurers to sell insurance across state lines. My reply to that has always been that if insurers were allowed to
sell across state lines, they'd relocate their companies to the states where they were required to offer the fewest benefits and exclude the most unwanted
customers, in order to maximize profits.

For example, New York requires that insurers cover chemotherapy. Iowa does not. My argument would be that if insurers could sell across state lines, they
could theoretically move their insurance companies to Iowa and stop covering chemotherapy.

Today, someone countered that even if Iowa based insurers were allowed to sell in New York, they would be required to provide the chemotherapy coverage that
New York requires because the people that they were covering were located in New York.

Is that true? Would the regulations that specify what coverages must be provided be based on the state where the insurers are based or would they regulations be
based on the state where the purchaser of the insurance is located?

Since currently, insurers must be located in the state where the insurance is sold, it's hard to tell.

[abluelady]

1. I Think It is True

And I believe that is one reason insurance companies haven't fought for this. How do we begin regulating this? Another issue is who do you go to complain to when each state has different requirements? Guess government will need to grow!

[angrycarpenter]

2. All the credit card companies went to Delaware

Because they have lax regulations, why not insurance companies? You bring up an entirely plausible scenario.

[dflprincess]

3. Actually, no, they went to South Dakota

at least my Citibank cards did. They all moved there because the usuary laws are lax (if they exist at all). The odd thing is, none of the executives relocated to Sioux Falls when the company supposedly did. You would think if a company claims to located somewhere, the corporate offices would be in that location.

Delaware was (and I assume is) the state of choice for incorporation long before deregulation changed banking rules, largely because of it's corporate friendly laws & taxes.

But you are correct, the insurance crooks will all claim they're located in the state with the least insurance regulation. The whole argument for changing the law to let them sell "across state lines" falls apart when you see how many states monoliths like United Health Group or Cigna are located in.

[YewNork]

7. Each of the big insurance companies is made up of multiple subsidiaries

There's
United Healthcare of Florida
United Healthcare of Ohio
United Healthcare of Tennessee
United Healthcare of Illinois
etc, etc,

They're all part of the parent corporation, but each one is set up to serve the residents of the states where the subsidiary exists, and each subsidiary must meet the insurance regulations of that state. I can only see that allowing insurers to sell across state lines would mean a big exodus from the states that require the most coverage, to the states that allow the longest periods to exclude pre-existing conditions, and that are the most profitable for the insurance companies.

It would also mean that the voters in the states that have the fewest regulations would have control over the insurance of people in other states, because only they would elect the governments that establish the regulations that control the insurers. I'm sure the insurers would love that. They'd only have to try and lobby the politicians in a few low regulation states instead of a 50 states.

[dflprincess]

9. I know that

I used to work at the Evil Empire's corporate office (years ago).

But to hear the Republicans talk, you would think that there is no selling in other states at all. They talk as if all the money from the subsiaries around the country wasn't finding it's way into It's as though UHG headquarters in Minnetonka, MN.

I agree completely that this "sell across state lines" meme is just another attempt to aid the insurance companies by letting them "move" to the state(s) with the least regulation.

[sandnsea]

4. Insurance companies already do that

An insurance company located in Connecticut, for instance, is licensed to sell in various states. When they get the license in that state, they have to sell according to that state's laws.

Selling across state lines means I can go buy from a state that has less requirements and get it cheaper. I think that's the entire point of the proposal. I can't see any other reason because like I said, an insurance company can already set up in any state they want and sell wherever they want if they meet the state requirements. And they do.

[YewNork]

5. They currently set up individual sub corporations in multiple states

And what some people who are in favor of allowing insurers to sell across state lines are telling me is that if insurers could sell across state laws and YOU went to an insurance company in another state, that insurance company would be required to meet the insurance regulations of the state where you (the purchaser) lived, not the regulations where the insurance company was based.

I'm trying to determine if that's true or not.

[sandnsea]

6. From Kaiser

They don't set up sub-corps, they just get licensed in the various states they want to sell in. Selling across state lines could work in various ways, but the point is to get around state coverage requirements.

http://www.kaiserhealthnews.org/Stories/2010/February/04/health-insurance-across-state-lines.aspx

[YewNork]

8. Leads to more people losing insurance

What it comes down to is that the people who need certain coverages would be forced to buy insurance from the states that force the insurers to sell that coverage, while people who feel they don't
need that coverage will buy from insurers in states that aren't required to cover it. That starts a viscious cycle where the insurance of the sick becomes more expensive because the pool of insured
has more sick than healthy people in it.

[sandnsea]

10. Oh I think it's an awful idea

Even with the exchanges, we're going to have to make sure our state legislators don't start overturning laws we fought long and hard for. We're going to have to keep pushing for solid basic coverage as it is, without these dumbass states that convince their people that a $10,000 deductible is okay or some stupidity like that.

[KT2000]

11. right now that is true

but if the law allows "selling insurance across state lines" that means they would not have to follow the state's laws. That is the way they want to change things.
Right now, insurance companies maintain offices and register in the states where they sell insurance but they are mostly national companies.

You are right to expect the worst.

[SteveM]

12. Hell, let's sell health insurance over NATIONAL lines...

Find out what it would cost to get Canadian health insurance, pay that sum into Canada's tax system, deduct same from our I.R.S., and save everyone money all around. I would imagine that the average portion of Canadian taxes expended for its health care system would decrease with greater U.S. support, and the U.S. would not be as burdened with the crap "reforms" enacted or proposed. And the U.S. taxpayer could be relieved of paying that same amount here.

I mean, aren't we a part of the New World Odor?