Health Insurance Rates

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Strong Support for Proposition 45 — Tougher Rules on Health Insurance Rates

(Getty Images)

(Getty Images)

By Helen Shen, Kaiser Health News

California voters are showing strong early support for a ballot initiative that would expand the state’s authority to regulate health insurance rates.

Nearly 7 of every 10 respondents indicated that they would vote in favor of Proposition 45, while 16 percent would vote against it, according to a Field poll released Wednesday.

Proposition 45 would give California’s insurance commissioner the power to veto excessive health insurance rate increases.

Health insurance rates in the state are currently overseen by the Department of Managed Health Care and the California Department of Insurance. Insurance companies are required to submit proposed rate increases for review each year by state regulators, who may declare rates unreasonable but cannot block them from going into effect. Continue reading

State Hires Consumer Group To Help Review Health Insurance Rates

California Insurance Commissioner Dave Jones has irritated the insurance industry and surprised public-policy analysts by hiring Consumer Watchdog, a vocal insurance industry critic, to assist in reviewing health insurance rate increases, the Los Angeles Times reports.

In a one-year contract worth up to $88,000, Consumer Watchdog will supplement the rate review process already done by the insurance department.

From the Los Angeles Times:

The insurance industry expressed dismay that the state enlisted its longtime nemesis to help review rate increases, and some experts questioned whether it’s necessary to further antagonize insurers at a time when state officials are trying to work closely with the industry to implement a massive healthcare expansion.

Public-policy experts also scoffed at the arrangement. Continue reading

Insurance Commissioner Calls Aetna Rate Hike “Unreasonable”

By: Kamal Menghrajani

AetnaRate_Images Money_Apr62012

Aetna has raised rates on its PPO by 30 percent in the past two years. (Images Money: Flickr)

If you were a California business making nearly 28 percent profit, would you change your business strategy if someone asked you nicely?

Probably not.

In a nutshell, that’s what’s going on between California’s Department of Insurance and the health care insurer Aetna.

The Department of Insurance has many jobs, one of which is to make sure that rates stay reasonable by regulating what insurance companies can charge consumers … with one exception.

According to Insurance Commissioner Dave Jones, “I have that authority for auto insurance, for homeowners’ insurance, for property insurance, for casualty insurance — basically for almost all other insurance lines, except health insurance and HMO products.”

“This is the first time that a health insurer has disregarded our request that it lower its rate increase.”

Jones doesn’t like it. “It’s quite a loophole, and it’s a loophole through which health insurers and HMOs have been driving ever-increasing rate hikes –- 10-20-30-40 — sometimes as much as 80 percent annual rate increases.”

This time around, Aetna increased their PPO rates by 1.8 percent for the quarter that began April 1st. This seems like a modest hike, but it brings up the total rate hike in the last year to 8 percent, and it means that small businesses are paying 30.3 percent more for health insurance than they were two years ago. Continue reading

Proposed Ballot Measure Seeks Tougher Health Insurance Rate Regulation

The ballot initiative would grant California's Insurance Commissioner the authority to reject health insurance rate increases. (Photo: Thinkstock)

The ballot initiative would grant California's Insurance Commissioner the authority to reject health insurance rate increases. (Photo: Thinkstock)

In more than 30 states, government insurance departments have the authority to reject what they determine to be excessive rate hikes for health insurance. But not in California. Earlier this month, consumer advocates launched a drive to put an initiative on the November ballot to let voters decide if California’s Insurance Commissioner should have this power.

“Right now, my sole authority over rates, if I find a rate to be unreasonable, is to sentence a health insurer to my website,” joked Dave Jones, California’s Insurance Commissioner, in an interview.

That’s a bit of an overstatement, as his department does review rates, making sure the math is right and ensuring there are no inaccuracies. Still, what the Department is left with is “whatever element of the bully pulpit we have to try to rein those rates in,” Jones says. Continue reading