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Letter: Big insurance has monopoly in Kentucky

October 09, 2009

Dear Editor,

When President Obama recently mentioned that one big insurer controlled 96 percent of the market in just one state, a collective (and very loud) gulp went down the throats of insurance industry executives.

You see, this domination of the small group market, where small businesses are forced to buy insurance, drives costs up at an unsustainable rate.

So, the secret is out, but the question is: Will the insurers fess up?

As the state director of the National Federation of Independent Business/Kentucky, I hear first-hand from small business owners about their ever-increasing costs and lack of choices.

But, the proof is in the pudding, or in this case the Government Accountability Office's research.

According to the GAO (February 2009), 96 percent of Kentucky's small group health insurance market is controlled by the five large insurers, with Anthem Health Plans of Kentucky writing nearly half of all policies.

Yes, there are 1,300 health insurance providers in the United States, but the vast majority of them aren't doing business in Kentucky.

Why not? Because state-regulated health care for small business has become a virtual monopoly for big insurance. Small business owners and their employees have been crushed under this model, while companies like Anthem and a few others have flourished under it.

We are in new times, however.

Congress is considering reforms that would allow small businesses to shop for health insurance like each of us buys our car insurance and groceries. A transparent exchange would spur badly needed competition, help contain rising costs, increase pool size and keep big insurance honest.

I urge your readers to encourage our members of Congress to make meaningful market-based health care reform a reality.

Tom Underwood
Kentucky State Director
National Federation of Independent Business
Frankfort

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