In an op-ed in the Democrat and Chronicle, Albert P. Hooke, a retired banking executive and past board chairman for BlueCross BlueShield writes about his concerns for enacting “Prior approval” in New York.

“I must take issue with Assemblyman Joe Morelle’s Feb. 7 Speaking Out essay calling for New York state to reinstate “prior approval” on health insurance premiums.

As a former Rochester businessman, I was privileged to serve as chairman of the local BlueCross BlueShield board of directors in the late 1980s. I saw firsthand the disastrous effects that prior approval had for our health plan, as well as for the employers and families that carried our coverage…

By denying needed increases, the state forced the health plan to incur multimillion-dollar losses that brought its financial reserves to a level that violated the state’s own rules. The state’s actions put the health plan into a financially impaired position. To remain solvent, BlueCross BlueShield was forced to increase premiums in 1988 and 1989 by nearly 40 percent to both replenish its lost reserves and to cover year-to-year cost increases.

That’s the problem with government price controls. Setting health insurance prices artificially low, without addressing the root causes for the increasing costs, does not make premiums more affordable. It only postpones and compounds the price increases that will be required in later years to cover ever-increasing claims expenses.”

To read the entire op-ed click here.