Nonprofit health insurance companies have been stockpiling billions of dollars in surpluses while raising members' rates, according to an analysis conducted by the nonprofit Consumers Union.
"Consumers are struggling to afford health coverage," report author Sondra Roberto said. "Those funds could be used in some cases to mitigate these rate increases."
Insurers are legally required to retain a minimum surplus in order to cover medical bills in the event of a financial downturn. Because no maximum surplus is set, however, many insurers have taken to amassing massive stockpiles.
To assess the degree of this problem, Consumers Union analyzed the surpluses of nonprofit Blue Cross and Blue Shield plans, which cover one in three privately insured U.S. residents. Surpluses ranged between two and seven times the minimum required.
Article from Natural new.
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