Insurers that want to raise premium rates by 10% or more must now submit proposals to state or federal reviewers, who will determine if the hikes are reasonable. Under a requirement of the healthcare reform law, independent experts will compare the requests against underlying cost trends in healthcare. Consumers in every state will be able to view and comment on information explaining increases of 10% or more—compared with last year's rates—beginning in mid-September. HHS says funding from the Patient Protection and Affordable Care Act helped Maryland reduce premium increases in 10 of the 22 rate filings approved during the third quarter of last year, while Rhode Island lowered a 20% increase to 10% last month.
Late News: Insurance premium rate hikes 10% or more now require review
Federal grant funding, HHS said, has allowed states to hire more staff for rate reviews; invest in needed information technology; and improve filing requirements. The industry's largest trade group doubts the reviews will have much effect. “Premium costs are a reflection of the underlying cost of medical care in a local market,” America's Health Insurance Plans wrote in a blog post last week. “Highly publicized provisions such as premium rate review make for good sound bites but literally do nothing to address the soaring cost of medical care.”
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