OLYMPIA, Wash. – Two of Washington’s largest nonprofit health insurers are each sitting on record surpluses of more than $1 billion.
“At a time when people are paying more for their health premiums and getting less, these companies have stockpiled huge assets,” said Insurance Commissioner Mike Kreidler.
State law requires Kreidler’s office to ignore insurer surpluses when reviewing proposed premiums. Kreidler has repeatedly tried to change the law.
“It’s like trying to ignore an elephant in the room,” he said. “And the elephant’s getting bigger.”
Premera Blue Cross has a surplus of $1,015,692,693, according to its most recent quarterly filing with the insurance commissioner’s office. Regence BlueShield’s surplus is $1,048,103,555. The surpluses have grown dramatically (see accompanying charts) since 2000.
“Some insurance lobbyists like to describe these surpluses as `reserves,’” said Kreidler. “That’s simply not true. A company’s surplus is above and beyond what the company has set aside in its reserves.”
Kreidler has proposed legislation three times to allow his office to consider surpluses when reviewing rates. The most recent was Substitute Senate Bill 5247, which died in the Senate Rules Committee earlier this year.
“Families are clearly struggling to afford insurance,” said Kreidler. “More than a million Washingtonians have no health coverage at all. Yet very few people know how much these nonprofit health insurers are sitting on.”
Kreidler intends to propose the legislation again next year.
“The larger these surpluses grow, the harder it is to make the case that we should ignore them,” he said.