Healthcare is certainly a hot button issue here in California with recent increases in insurance rates crossing all time highs and making people either opt for lower coverage or even no insurance at all. Health insurance was supposed to be a means to support the individual against the rising costs of healthcare by providing a collective way to spread the risk. In order to counter the impact of such arbitrary increases in premium rates, the state of California is looking into laws limiting the increases on healthcare insurance premium rates.

It is pertinent to note that insurance companies along with increasing the premiums by large amounts have also increased them more than once, over the span of a single year. This has made it really difficult for the common public to maintain their insurance coverage, often leaving many uncovered. According to a study, between the years 2000 and 2007, premium rates have increased to become almost double, from an average of $6,227 to $12,194, while wages have only increased by 19%, thus making increased insurance rates five times higher than wages. One of the legislative proposals on the table is looking to not only limit the percentage increase on insurance premium rates but also limit the number of times it can be increased to only once per year. Of course there has been strong debate as to whether a move like this will actually help in the long term. While most feel that capping health insurance rate increases will not automatically solve the problem Californias are facing, others are sure that this is a move in the right direction.

One of the major reasons why a law like this should be supported is that it will actually help more people remain insured or at least maintain their insurance coverage. While increases to insurance rates are normal and expected, it is the arbitrarily high percentages that are throwing people out of the system. Secondly, it will also enable people to retain their present coverage. These large increases have resulted in less coverage, which has led to more diseases or problems being not covered by insurance, and finally leading people to seek emergency help which of course is covered by tax payers. According to the Center for Retirement Research at Boston College, given the present arbitrary hike in the rates, a typical married couple would have with all likelihood spent about $197,000 on uninsured and uncovered medical expenses, all of which can be simply avoided by this solution.

Limiting increases will also reduce the monopoly of certain insurance companies, making insurance truly a social service to the public at large. Lastly, what most people are hoping for through all this is help in limiting the rising cost of healthcare paid by the state of California, which can be quite beneficial considering the current budgetary problems.

Every move has its own advantages and disadvantages and it is important to consider both. However, despite the varied doubts regarding whether or not legislation like this will ultimately succeed, it is definitely a move in the right direction. Moreover, with the right kind of support from all parties, there is no reason why it should not succeed.