Texas Needs Tools to Increase Private Health Coverage: How Improving Public Oversight Can Bring Health Care to More Texans

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Stacey Pogue /(512) 320-0222 x 117

June 23, 2008

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By insurance industry standards, Texas’ commercial health insurance market is considered one of the healthiest in the United States because it has a relatively large number of insurance companies offering plans, is subject to less rate regulation than in most states, and brings in $22 billion a year in premiums. The effect of this market on Texas consumers, however, is anything but healthy. The private health insurance market in Texas leaves one in four uninsured, generates the third highest premium increases in the nation, and produces one of the lowest rates of coverage through employer-sponsored insurance in the nation. Many small-business owners in Texas want to provide coverage to their workers but cannot afford to with premium quotes as high as $23,000 a year per employee. Texans must think twice before switching jobs or starting businesses for fear that a preexisting condition will prevent them from getting health insurance. The notion that a hands-off approach to regulation promotes the best outcomes has not worked any better in the Texas health insurance market than it has in the mortgage industry. Texans deserve a truly healthy insurance market in which insurance companies vigorously compete for business and make reasonable profits while consumers are able to purchase the insurance they need at prices they can afford. This policy page focuses on sensible market reform options—many already enacted by other states—that can help make private health insurance more affordable and accessible in Texas.