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Gibbs: Federal Health Rate Regulator Not A New Agency

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Obama administration officials want the U.S. Department of Health and Human Services to work with state insurance regulators to oversee health insurance prices, rather than creating a new price review agency.

White House Press Secretary Robert Gibbs gave that interpretation of the Obama administration health system proposal Monday, during a briefing.

The administration has released a proposal that calls for creating a “Health Insurance Rate Authority to “provide needed oversight at the federal level and help states determine how rate review will be enforced and monitor insurance market behavior.”

If a health insurance increase was “unreasonable and unjustified,” the government could make a health insurer lower premiums, provide rebates or take other actions to make premiums affordable, officials write in the proposal.

Gibbs described the proposal as a “starting point” for the health reform summit President Obama plans to hold Thursday in Washington.

Although the proposal refers to a “Health Insurance Rate Authority,” the HIRA is “not a new federal agency,” Gibbs said, according to a briefing transcript provided by the White House. “There’s no new bureaucracy. This will be done out of the secretary’s office” in the U.S. Department of Health and Human Services.

A reporter at the briefing asked whether the HIRA would “serve as a guide” to the “50 states that do the actual regulating.”

“The [HHS] secretary in conjunction with states will develop a review process for unreasonable premium increases,” Gibbs said.

State regulators are “going to still have a big role in this,” Gibbs said. Rate increases “will be looked at an evaluated in conjunction with the states, and then steps and measures can be taken,” he said.

State insurance commissioners already regulate rate increases in some states, Gibbs said.

Reporters asked whether the Obama administration would consider using a process called “budget reconciliation,” which requires just a 51-vote majority in the Senate, to pass a health bill. Gibbs noted that the Bush administration used the process to pass tax cuts in 2001 and 2003, but he said Obama hopes to wait and see what happens Thursday before talking about that topic.

The administration does hope Republicans will come to the summit open to discussing ideas about health care, Gibbs said.

“The price is skyrocketing; small businesses are dropping their coverage; some of them are going out of business; it’s crippling families’ budgets,” Gibbs said. “We know what it’s doing to the federal government’s budgets. Simply saying no, simply discussing why … some people oppose one idea without bringing to that table a series and set of solutions that will help the problem is not fulfilling a role in representative democracy that’s intended through their representation.”

A reporter then asked whether “the insurance companies” are sabotaging health reform efforts.

“Well, I’ll tell you what is amazing to read is when — is when you take an insurance company that raises their rates 39%, like we saw in California, they’re called out for raising their rates,” Gibbs said. “They say they’re raising their rates because we don’t have health care reform. And then you figure out who has been pushing most against and funding the ads against health care, and you realize behind curtain number one are the same people that just jacked up rates. I think that demonstrates probably as illustratively as anything why health care reform can’t wait.”