Recent health care reforms in several states have sought to make affordable insurance coverage available to all. Instead, they have substantially increased the number of uninsured people and the cost of insurance.

The reforms have focused on insurance for individuals and small employers. Generally they have stipulated that individuals could not be turned down for coverage regardless of health condition (guaranteed issue) and have limited the ability of an insurer to adjust rates for different risk groups (community rating).

Among the results:

• In the nine months after New York state implemented guaranteed issue and full community rating in April 1993, 350,000 people dropped their insurance coverage.

• Mutual of Omaha reported that the cost of medical expenses reimbursed in New York increased by 130 percent in 1994, versus 8.6 percent nationwide, and a number of insurers stopped writing individual health policies in the state.

• The cost of coverage in New Jersey's individual insurance market has more than doubled compared to costs in nearby Delaware and Pennsylvania.

• A Blue Cross Blue Shield of Vermont policy for a family of four now costs the family 24 percent of its aftertax income, compared to less than 5 percent previously.

• When Kentucky prohibited all policies that did not include state-mandated benefits, premiums increased by 80 percent or more, and at least 60 percent of the insurance carriers that had been offering coverage left the state.

Source: Art Astorino et al., "State Health Insurance Reform: Experience with Community Rating and Guaranteed Issue in the Small Group and Individual Markets," April 1996, Council for Affordable Health Insurance, 112 South West Street, Fourth Floor, Alexandria, VA 22314, (703) 836-6200.