The growth in the cost of health insurance premiums is one of the major drivers of escalating consumer health care costs. During the national reform process, state advocates urged the federal government to strengthen the regulations governing the rate review process, responding to the Department of Health and Human Services’ request for comments.

Nine consumer advocate groups and Community Catalyst partners submitted public comments on the proposed federal rule. The organizations called for enhanced transparency in the rate review process, timely notification of proposed rate increases to policyholders, a robust role for public participation in the rate review process, and stronger evaluation criteria, including prior approval authority, mandatory review by a state or independent actuary, and historical review of rate increases.

Advocates drew on the specific experiences of consumers in their states to explain the importance of strengthening the federal rule. In Texas, for example, the Center for Public Policy Priorities described the difficulty in obtaining a simple “summary table of rate increases over the last year showing the carrier, policy form, and percentage increase only for filings that were not marked confidential, and to date have been unable to obtain that information” (emphasis omitted). Enhanced transparency requirements, including mandatory notification to policyholders on proposed rate increases and public posting of rate increases on state insurance division websites, will empower consumers to advocate for fair and equitable rate increases and discourage insurers from requesting unreasonable and excessive rate increases.

The Colorado Consumer Health Initiative underscored the strength of Colorado’s rate review process, and urged that all states should have a robust statutory review scheme. A recent retroactive review of one Colorado insurer revealed it was charging unreasonable premiums in the individual market to 90,000 individuals. The rate review process resulted in a $20 million credit to the insured for coverage for overcharges during a 10 month period. The outcome of the review in Colorado highlights the need for comprehensive evaluation of proposed rate increases and a process to compensate consumers who have been victims of unreasonable rates.

States will continue to perform the majority of rate filing reviews, so the rate review process they employ will be critical. State advocates are playing a crucial role ensuring that state rate review processes are strong and effective.

— Sarah Blumenthal, Private Insurance Intern