Insurance Freeze

When you apply for insurance, you must disclose any "conditions" and up until Sept 23rd (supposedly) EVERY insurance carrier would deny you covereage.

The new law addresses those outrageous practices first. It was supposed to take effect on Sept 23rd, but it turns out, the insurance industry has decided that they don't like these rules so they are going to sidestep them by refusing to write any policies for children. In other words RIGHT NOW YOU CANNOT BUY INSURANCE FOR A CHILD. All the carriers have stopped writing policies except BLUE SHIELD.

I had the rare priviledge of speaking to a senior account specialist at Blue Shield today in a conference call with an agent. We were trying to see if we could switch to blue Shield and thus be able to get Nico's operation.

First thing to know is that they are all guided by the electronic "bible" that they can search within their network only. This document is the absolute final word on how they write business and what their policy is on all things.

It is a document that is issued by the teams of Harvard MBA's that are tasked with the job of squeezing every last cent out of this business and signed off by the senior bean counters.

The current rhetoric from this document is that because dedcutables are calcualted each year, they are "not able" to issue new policies to children with "pre-existing" conditions until Jan 1st 2011. I guess it would make their accounting difficult.

So even though there is black letter law to the contrary, you cannot get an IFP (Individual Family Plan) until Jan 1st with Blue Shield, the only carrier writing new business.

Meanwhile, insurance rates went up as much as 48% this month. After Jan 1st, rates may go up again. Well now, there is a shocker.

Currently, they rate you from Tier 1 to Tier 5. Tier 5 is about double the cost of Tier 1. If one member of the family has a pre-existing condition, then they will be at Tier 5 while the rest of the family may be at Tier 1, putting the plan somewhere around Tier 3 (50% more expensive).

If you need a procedure and are thinking of doing it on your own dime, dont bother. It takes two years before that rate decreases after a surgery because of the risk of complications. So even if you pay for your own surgery, your insurance will be the same rate as if you had not.

Apparently, Blue Shield is swamped with new business right now and MANY MANY parents are demanding to know why they still cannot get coverage. I am more interested in why the politicians are not all over the insurance industry for flouting the new law?