CHARLESTON, W.Va. -- Health-care insurance costs are exploding today, compared to the wages most Americans earn.
Alex Lawson, from the Washington, D.C.-based Institute for America's Future, said Thursday, "In West Virginia, where a few health insurance companies dominate the market, health insurance premiums grew four times faster than wages between 2000 and 2007.
"The two biggest insurance providers in West Virginia now control 54 percent of the market. Freedom from real competition allows West Virginia insurers to reap profits with impunity.
"Between 2000 and 2007, median wages in West Virginia increased by 19 percent, while [health insurance] premiums rose by 75 percent.
"The health insurance industry is insuring profits, not insuring health. West Virginia is a textbook example of market failure," Lawson said.
Lawson was part of a Thursday telephone conference coordinated by the West Virginia Citizen Action Group.
"Today, 94 percent of all insurance markets in the U.S. are considered highly concentrated," Lawson said. "That means most insurance companies can raise premiums, reduce the variety of plans available and cut service to customers with impunity."
Lawson helped write a new report titled
Gary Zuckett, director of WV-CAG, said Sen. Jay Rockefeller, D-W.Va., sent the group a letter praising the new report.
"Rockefeller said the report makes the case for a public health insurance option, something he strongly supports," Zuckett said.
Rockefeller's letter stated, "We need to provide quality affordable coverage for the millions of Americans the insurance industry has failed."
Zuckett said competition between public health insurance and private plans would enable people to pay less for better coverage.
Larry Matheney, secretary-treasurer of the West Virginia AFL-CIO, criticized political leaders who want to tax health insurance benefits.
"If you tax health benefits, you would see a further decline in disposable wages. That would have a negative impact on our retail-driven economy and fewer employers would offer employer-sponsored health care."
Health insurance costs will go up by 24 percent on July 1 for everyone working at the AFL-CIO headquarters in Charleston.
"This is partially driven by the lack of competition and largely driven by the greed of health insurers, as well as our health-care delivery system," Matheney said.
Lawson said he sees a growing consensus among health experts that "only a public health plan not driven by profit will provide a counterweight to private insurers, making them deliver a quality product at prices customers can afford."
Lawson also said health insurance is a major factor in today's auto industry crisis.
"Automakers in no other nation have to factor the cost of health insurance into the cost of producing a automobile," he said.
Reach Paul J. Nyden at pjnyden@wvgazette.com or 304-348-5164. To see more of The Charleston Gazette, or to subscribe to the newspaper, go to http://www.wvgazette.com. Copyright (c) 2009, The Charleston Gazette, W.Va. Distributed by McClatchy-Tribune Information Services. For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.
Copyright (C) 2009, The Charleston Gazette, W.Va.