Happy Independence Day to the Bleeding Heartland community! I hope everyone is enjoying the holiday weekend–preferably not by setting off amateur fireworks. Although the Iowa House voted this year to legalize fireworks, the bill never came to a vote in the Iowa Senate. So amateur fireworks are still illegal, which is just as well, since they cause too many emergency room visits and distress for veterans with post-traumatic stress disorder. We caught the fireworks display after the Iowa Cubs baseball game on Friday night and are going out in a little while to see the Windsor Heights fireworks.

The Iowa Natural Heritage Foundation marked the holiday by posting some stunning pictures of Iowa wildflowers, “nature’s fireworks.”

Alfie Kohn noted today that socialists authored both the Pledge of Allegiance and the words to “America the Beautiful,” which for my money should be our national anthem.

Speaking of which, former Iowa Insurance Commissioner Susan Voss sang “The Star-Spangled Banner” before the Iowa Cubs baseball game last night. Who knew she had such a good voice?

Two Democratic presidential candidates spent the day in Iowa. Senator Bernie Sanders and many supporters walked the parade in Waukee, a suburb of Des Moines. Former Maryland Governor Martin O’Malley was in Independence, Dubuque, and Clinton.

As is our family’s custom, I took the kids to the Windsor Heights parade this afternoon. It’s one of the smaller parades in the Des Moines area, which explains the relatively sparse presidential campaign presence. On the Republican side, Louisiana Governor Bobby Jindal was there; he also walked the Urbandale parade route earlier in the day. A few volunteers handed out stickers for Ben Carson, and I didn’t see any other GOP campaigns represented. On the Democratic side, Hillary Clinton’s campaign had a small presence; apparently more supporters walked for her in Waukee.

U.S. Representative David Young (IA-03) was working the crowd along the parade route. One of his potential Democratic challengers, Desmund Adams, mingled with Windsor Heights residents before walking the Waukee parade.

This is an open thread: all topics welcome. After the jump I’ve enclosed a few photos from the Windsor Heights parade, including one wildflower shot, inspired by the Iowa Natural Heritage Foundation. I also posted the roll call from the Iowa House vote in May to approve the fireworks legalization bill. That legislation split both the Democratic and Republican caucuses.

At least 40,000 Iowans are in danger of losing their health insurance later this year, and not only because of the King v Burwell case before the U.S. Supreme Court. Regardless of how justices decide that case, Iowans could lose access to federal subsidies they need to buy insurance policies.

State legislators and Governor Terry Branstad could eliminate the risk by working together to establish a fully state-run health insurance exchange this year. But for reasons I can’t comprehend, I see no sense of urgency to prevent a potentially devastating outcome for thousands of families.  

Governor Terry Branstad recently named Nick Gerhart to be Iowa’s next insurance commissioner. Gerhart will take over the position from Susan Voss at the end of 2012.

The insurance commissioner’s work next year will be important as Iowa implements the federal health insurance reform law or designs its own alternative. For this post, though, I’m more interested in what this appointment reveals about Branstad’s governing style.

Roughly 46,000 Iowans who buy individual health insurance policies through Wellmark Blue Cross/Blue Shield will face an average rate hike of 8.5 percent this year, instead of the 11 percent Wellmark requested. State Insurance Commissioner Susan Voss announced on Friday that she had approved a smaller rate increase, in part because of reviews conducted by two actuaries who said Wellmark’s request was excessive. A law enacted in 2010 required an independent actuarial review whenever an insurer’s proposed premium hike exceeds the medical inflation rate.

According to the Des Moines Register, Voss said in a January 28 press release

that her department would look into whether the company has appropriate levels of reserves. She said the department also would examine how Wellmark’s dominant position in the Iowa market affects Iowans.

“We’ve heard the concerns of Wellmark’s customers,” Voss said.

“We think the time is right for a careful professional analysis of these two additional areas. We gained valuable insights from the extended review just completed that allowed us to arrive at the appropriate level of permitted rate increase. Learning more facts on these points will be useful in future considerations of rate adjustments.”

Wellmark has a near-monopoly on the individual health insurance market in Iowa. The company is the provider for more than 70 percent of Iowans who purchase their own health insurance.  

Thousands of Wellmark Blue Cross/Blue Shield customers learned late last year that their health insurance premiums would go up by 11 percent in 2011. Yesterday state Insurance Commissioner Susan Voss received reports from two actuaries who found that rate hike to be too steep:

Close to 46,000 Iowa policyholders under age 65 will see an increase in their base premium rate of 10.8 percent, effective April 1, 2011, if approved. Another 3,000 basic and standard policyholders will receive an increase of 11.3 percent. Approximately 2,500 Blue Transitions policyholders will receive an increase of 15 percent.

The company raised rates by 18 percent in May of 2010. […]

Lewis & Ellis Inc., of Overland Park, Kan., said Wellmark’s proposed rate increase is too high. They recommend a 7.5 percent instead of the proposed 10.8 percent increase.

The Insurance division’s in-house actuary is recommending a 9 percent increase.

Tom Alger with the Iowa Insurance Division said the reports will weigh heavily in Voss’ decision about whether Wellmark will get the rate increase it wants.

Voss also presided over a public hearing yesterday, at which an attorney for Wellmark defended the rate hike, and some customers asked Voss to reject the insurer’s proposal. But a rate increase of 7 percent or 9.5 percent would still be unaffordable for many customers, and there are other problems too:

State Rep. Janet Petersen, who last year pushed legislation requiring the hearings and the independent actuarial review, called the recommendations a small victory.

The Des Moines Democrat noted that even if Wellmark is denied permission to raise its base rates as much as it wants, it still can impose big increases for people who shift into new categories, including as they age.

For individuals and families who buy their own health insurance, Wellmark has a virtual monopoly in Iowa. Giving Americans the option of buying into Medicare would not instantly make health insurance affordable, but it might constrain the excessive rate increases from companies like Wellmark.

Approximately 80,000 Iowans will face substantial health insurance premium hikes beginning May 1. An independent review has confirmed the “need” for Wellmark Blue Cross and Blue Shield to raise rates by an average of 18 percent. The higher rates were intended to go into effect on April 1, but last month Governor Chet Culver ordered a delay pending an review of the matter. The Des Moines Register reports today,

[Iowa Insurance Commissioner Susan] Voss said in a memo to Culver that Wellmark’s losses supported “the need for the rate increase” based on two separate actuarial analyses conducted by INS Consultants, a Philadelphia actuary. The group also found that the insurance division’s rate review process is actuarially “acceptable” and “reasonable” compared with INS’s methodology.

Birny Birnbaum, head of the Center for Economic Justice, a nonprofit consumer advocacy group in Texas, said it’s unlikely that INS would disagree with the rate increase.

“While INS is technically independent, there is no way the firm would contradict and embarrass the agency which hired the firm,” Birnbaum said Monday. “If INS were to contradict the insurance division, it would likely not be hired in the future by the Iowa Insurance Division or any other insurance regulator.”

Speaking to the Register, State Representative Janet Petersen touted legislation passed during the 2010 session, which is intended to give consumers more information and warning regarding health insurance premium increases. After the jump I’ve posted some key points from Senate File 2201 and Senate File 2356.

These bills contain a lot of good provisions but probably won’t solve this particular problem for many Iowans. Wellmark dominates the insurance market in this state. Giving people a few weeks to shop around won’t magically allow them to find a better deal. In addition, health insurers can still exclude coverage for pre-existing conditions until 2014. The only real choices Wellmark’s individual customers have are: 1) pay a lot more, like my family, or 2) downgrade to a policy that’s less comprehensive and/or involves higher out-of-pocket costs for medical care.

Iowa House Republican leader Kraig Paulsen showed his creative side yesterday, finding a way to blame Democrats for Wellmark’s rate hikes:

Paulsen pointed out that the Democrat-controlled Legislature has voted in recent years to impose several health insurance mandates, such as coverage of cancer clinical trials and prosthetics.

“It’s indisputable that those add to rates. That’s just the way it works,” he said.

Health insurance mandates drive up costs for Iowans, Paulsen said.

“Mandates aren’t necessarily requirements that insurance companies sell something. They’re requirements that purchasers buy something,” he said.

One legislative proposal would have allowed state-regulated health insurance companies to provide mandate-free coverage “for those who want a less comprehensive product,” Paulsen said.

That idea by House Republicans failed, as did a proposal to study allowing out-of-state insurers to offer policies in Iowa, which could help Iowans find cheaper policies, he said.

Come on, Mr. Paulsen, who ever anticipates needing prosthetics someday, or being in a position to benefit from a cancer clinical trial? Anyway, that cancer clinical trial bill passed both the Iowa House and Senate unanimously. Also, allowing out-of-state insurers to sell policies here would spark a “race to the bottom” in terms of consumer protection.

Share any relevant thoughts in the comments.

Wellmark Blue Cross-Blue Shield recently announced premium increases averaging 18 percent for about 80,000 policy-holders. Tens of thousands of customers were facing rate hikes of 22 percent, effective April 1.

Today Governor Chet Culver halted the planned increases by Iowa’s largest health insurance provider. Details are after the jump.