HHS deems premium spikes unreasonable
Posted on January 12, 2012 |
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Today, the U.S. Department of Health and Human Services (HHS) Secretary Kathleen Sebelius announced that HHS has deemed insurance premium increases in five states as “unreasonable.” HHS determined that Trustmark Life Insurance Company has proposed unreasonable health insurance premium increases in five states—Alabama, Arizona, Pennsylvania, Virginia, and Wyoming. The excessive rate hikes would affect nearly 10,000 residents across these five states. To make these determinations, HHS used its “rate review” authority from the Affordable Care Act (ACA) to determine whether premium increases of over 10 percent are reasonable. In these five states, Trustmark has raised rates by 13 percent. HHS determined that the rate increases were unreasonable because the insurer would be spending a low percent of premium dollars on actual medical care and quality improvements, and because the justifications were based on unreasonable assumptions.
October 31, 2011
A new report commissioned by the insurance industry and authored by Oliver Wyman, "Estimated Premium Impacts of Annual Fees Assessed on Health Insurance Plans," quantifies the impact of insurer fees on private and public sector coverage. According to the report, the Congressional Budget Office (CBO) and Joint Committee on Taxation (JCT) have both concluded that such fees will increase insurance premiums. The analytical data presented in the report estimates that the insurer fees will increase premiums in fully insured coverage markets by an average of 1.9% to 2.3% in 2014. This translates into a $2,800 average increase in individual coverage cost, and $6,800 for a family over a 10-year period, beginning in 2014.
August 3, 2011
The Government Accountability Office (GAO) has released a report that examines state oversight of the insurance rate review process. The report finds that states' rate review processes varied in both approach and result, with some states achieiving a lowering of premiums after review and other states reporting no premium reductions following review. The report also provides information on changes states have made to their review process since the passage of the Affordable Care Act (ACA). The ACA requires the Department of Health and Human Services (HHS) to provide grants that assist states with their rate review activities, as access to affordable health coverage is one of the pillars of sucessful health reform.
For more information on insurance premium rate review, click here.
October 7, 2011
Since September 1, 2011, health insurance companies have been required to inform the public whenever they want to increase health insurance rates for individual or small group policies by an average of 10% or more. Insurance experts in state or federal government will then review these rate increase requests in a process known as "rate review." On Friday, the Obama administration released a Web-based tool that will allow consumers to track when health plans are considering steep premium hikes. The new tool enables insurance customers to search for potential hikes by state.
September 6, 2011
The U.S. Department of Health and Human Services (HHS) has issued an amended final rule clarifying the definition of "individual market" and "small group market" with respect to the rate review process authorized by the Affordable Care Act (ACA). The definition now includes association plans in the types of health insurance products that are subject to the rate increase disclosure rules ad reviews, even if States do not chose to regulate association plans as part of their own individual or small group markets.
For more information on the disclosure and review of insurance premiums under the ACA, click here.
December 21, 2010
The Department of Health and Human Services has released a notice of proposed rulemaking to implement the provisions of the health reform law providing for review of health insurance premium increases. Under the regulation, insurers seeking an increase of 10 percent or more in 2011 will be required to provide public justification; thereafter, states will set their own threshold for such discloser.
June 3, 2011
An earlier Implementation Brief provided an overview of the Disclosure and Review of Unreasonable Health Insurance Premium Rate Increases, which was established by §1003 of the Affordable Care Act (ACA) by adding §2794 to the Public Health Service Act (PHSA). On May 23, 2011, the Centers for Medicare and Medicaid Services (CMS) of the U.S. Department of Health and Human Services (HHS) published a final rule (with comment period) establishing a rate review program of “unreasonable” health insurance premium rate increases and implementing requirements for health insurance issuers regarding the disclosure and review of such unreasonable premium increases.
April 14, 2011
Over the past decade, health insurance premiums have doubled (with particularly sharp increases in the small group and individual markets), making insurance coverage unattainable for millions of Americans. News stories have reported that some health insurers have sought to increase premium rates as much as 50 percent.
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