The federal government will provide up to $1 million for each state that shows it will use the money to create and strengthen health insurance rate review processes.

The U.S. Department of Health and Human Services also opening the grant application process to the District of Columbia.

HHS officials will be distributing $51 million in Health Insurance Premium Review Grants provided by the Affordable Care Act, the legislative package that includes the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act.

The ACA premium review grant provision will provide $200 million in additional funding for premium review grants for 2011 through 2014.

“To receive a grant, a state must submit a plan for how it will use grant funds to develop or enhance its process of reviewing and approving, disapproving, or modifying health insurance premium requests,” officials say.

Jay Angoff, a former Missouri insurance commissioner, is director of the Office of Consumer Information and Insurance Oversight, a new agency that will help manage federal premium review efforts.

ACA provisions will require health insurers to spend 85% of large-group premiums on health care starting in 2011, and 80% of individual and small-group premiums on health care.

ACA provisions also will require health insurers to justify what regulators believe to be unreasonable premium increases, officials say.

House Speaker Nancy Pelosi says implementation of the premium review grant program will help “our families and our middle class.”

“With these grants in place, we will strengthen states’ abilities to review rate hikes, curb outrageous premium increases, and hold insurers accountable to their customers,” Pelosi says in a statement. “Insurers will face tougher oversight, and patients will benefit from greater transparency.”