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Thursday, March 17, 2011

Blue Shield Cancels Insurance Rate Increase

Blue Shield of California’s decision to cancel a big rate hike for nearly 200,000 people followed mounting pressure from the public and political leaders. But an unforeseen factor may have made the retreat easier for the company to accept: It’s paying out less for medical claims than it had anticipated. . . .

Company officials say that is largely because people are going to the doctor less. Many have switched to cheaper policies that require them to shoulder a greater share of the cost — and that has them thinking twice about discretionary visits. . . .

That trend could bolster the arguments of some healthcare experts who contend that Americans overuse medical services because they generally don’t have to pay much for them, and that the only way to bring rising healthcare costs under control is to shift more of the expense to patients.

If people continue to be more thrifty in their medical decisions, it could slow the rise of healthcare costs, some believe.” (Los Angeles Times)

Imagine what could happen without monopolies in insurance and health care provision.

FEE Timely Classic

Health Care and Radical Monopoly” by Kevin A. Carson