BizFeed: Health Insurers Want Big Rate Increases

Plus: Greeks vote "no"; Netflix asks crazy job interview questions.

Ben Franklin surgical mask


1. Health Insurers Seek Big Rate Increases

The News: Health insurance companies say the new patients they attained due to health care reform are much sicker — and expensive — than expected. And now, insurers around the country are hoping to raise rates 20 percent to 40 percent, according to the New York Times. That includes Blue Cross Blue Shield plans in five states (not including Pennsylvania.)

The Times says: “In their submissions to federal and state regulators, insurers cite several reasons for big rate increases. These include the needs of consumers, some of whom were previously uninsured; the high cost of specialty drugs; and a policy adopted by the Obama administration in late 2013 that allowed some people to keep insurance that did not meet new federal standards.”

Why It Matters: The byproducts of the Affordable Care Act are still taking shape. But it appears as though it’s fueling merger activity creating huge players in both care and insurance; as well as forcing insurers to raise premiums to deal with the influx of sick patients. Yes, more people are getting access to care but it comes at a price.

The Times says: “A study of 11 cities in different states by the Kaiser Family Foundation found that consumers would see relatively modest increases in premiums if they were willing to switch plans. But if they switch plans, consumers would have no guarantee that they can keep their doctors. And to get low premiums, they sometimes need to accept a more limited choice of doctors and hospitals.

“Some say the marketplaces have not attracted enough healthy young people. ‘As a result, millions of people will face Obamacare sticker shock,’ said Senator John Barrasso, Republican of Wyoming.”

2. Greeks Vote “No.” Now What?

The News: Greeks overwhelmingly voted against a bailout, refusing to accept their creditors terms. The country faces a very uncertain financial future, with banks grounded to a halt, drugs becoming scarcer and scarcer at pharmacies, and Greek credit not accepted outside the country. Bankruptcy and an exit from the euro are much more likely now.

Why It Matters: Greece now risks “financial and political isolation within the euro zone and a banking collapse if creditors refuse further aid,” said Fortune. “But for millions of Greeks, the outcome was an angry message to creditors that Greece can no longer accept repeated rounds of austerity that, in five years, had left one in four without a job.”

The Wall Street Journal says the “no” vote will “set the country on a collision course with the rest of the eurozone.” Greek Prime Minister Alexis Tsipras “might soon find it difficult to deliver on his promise to secure a more lenient bailout deal from Europe, where other governments, led by Germany, are in no mood to offer Greece more generous terms.”

All the uncertainty is sure to shake up stock exchanges across the world.

3. Netflix Asks Crazy Interview Questions to Job Candidates

The News: You don’t hear all that much about Netflix‘s corporate culture, but a new story from Business Insider with the help of Glassdoor offers a peek. The story highlights job interview questions at the streaming video giant. Here are three that stood out to me:

  • “What would you tell someone that is calling to talk about how Blockbuster is better than Netflix?” — Customer service representative candidate.
  • “Tell me something that you did in the past, but don’t want to do ever again.” — Engineer candidate.
  • “Of everyone on your team at your current employer, who would you keep and who would you fire and why?” — Senior software engineer candidate.

Why It Matters: Companies that have serious name recognition, and lots of profits, have earned the right to be choosy. But Business Insider says Netflix’s management philosophy may be rubbing some people the wrong way.

“Netflix published a summary of its management philosophy, which was instantly controversial for its lack of vacation policy, its stance on hiring ‘outstanding’ employees only, and its culture of ‘freedom and responsibility’ in which managers give their employees the right context to make decisions.”