Consumer Group Calls for More Regulation of Insurance Rates
On Thursday, the advocacy group Consumer Watchdog sent a letter to the Obama administration and Congress contending that the new national health reform law missed an opportunity to limit how much insurers can charge for coverage, the Los Angeles Times' "Money & Company" reports (Helfand, "Money & Company," Los Angeles Times, 4/8).
Consumer Watchdog Recommendations
Carmen Balber of Consumer Watchdog said the new law calls for HHS to examine "unjustified rates," but it does not define when a rate increase can be categorized as "unjustified." The law also permits HHS to offer grants to help states strengthen rate regulation (Felde, "KPCC News," KPCC, 4/8).
In its letter, Consumer Watchdog called for lawmakers to address 10 potential loopholes in the reform law. The group recommended:
- Requiring insurers to seek prior approval for rate hikes;
- Prohibiting insurers from rescinding coverage after a member becomes ill; and
- Providing Medicare with greater authority to negotiate prescription drug costs.
Premium Hikes Already Under Scrutiny in California
Experts say it is unlikely that Congress will pursue any major changes to the health reform law in the near future.
However, the California Legislature currently is considering a proposal that would require insurers to seek prior approval before instituting rate hikes ("Money & Company," Los Angeles Times, 4/8).
Premium increases have been a major issue in California since Anthem Blue Cross of California informed about 800,000 individual policyholders that their premiums would increase by as much as 39%.Last month, Consumer Watchdog filed a lawsuit against Anthem accusing them of violating a 1993 state law that requires insurers to offer comparable alternative policies or minimize premium increases for enrollees in closed health plans (California Healthline, 3/2). This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.