$1B in Premium Rate Increases Rejected in Rate Reviews

Margaret Dick Tocknell, for HealthLeaders Media , September 12, 2012

State and federal insurance premium rate reviews resulted in the denial, withdrawal or modification of an estimated $1 billion in health insurance rate increases in the individual and small group markets, according to the 2012 Annual Rate Review Report released Tuesday by the Department of Health and Human Services.

The rate review program requires insurers to publically disclose proposed increases and justify any requests to raise premiums. Although many states have long supported review programs, the federal program only went into effect on Sept. 1, 2011, so the 2012 report reflects the first nationwide effort to assess healthcare insurance premium rates.

The program includes a includes a provision of the Patient Protection and Affordable Care Act that requires premium rate reviews for increases of 10% or more in the individual and small group markets. That provision accounted for $148.4 million of the denials.

"The healthcare law is holding insurance companies accountable and saving billions of dollars for families across the country," HHS Secretary Kathleen Sebelius stated during a press conference to announce the report's release. "Thanks to the law, our healthcare system is more transparent and more competitive."

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2 comments on "$1B in Premium Rate Increases Rejected"

barium (9/12/2012 at 6:42 PM)
This is great! So, let's see...it would be like seeing prices rise at the pump and capping how much the gas station can charge, without addressing the cost of what he pays for gas from the truck. Let's not address the cost of care, just pummel insurers and if needed, make them take losses. Hello?

Jonathan L Lauer (9/12/2012 at 10:57 AM)
In the article, HHS Secretary Sebelius is quoted as saying, "the health insurance market is now 'working for consumers the way markets are supposed to work. Insurers are being forced to offer more competitive prices." On the contrary, if the insurance market really was "working for consumers", federal management of prices would not be necessary. Her comment makes it clear that she either does not understand the nature of free markets or does not want a free market. Genuine and comprehensive insurance market reforms could work, but we are moving in the opposite direction.




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