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PPACA: Arizona Implementing Health Rate Review Rules

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PHOENIX (AP) — Arizona is one of more than two dozen states challenging the Patient Protection and Affordable Care Act (PPACA), but Republican Gov. Jan Brewer’s administration is moving to implement part of the contested law by reviewing health insurance rates to see if they should be labeled unjustifiably high.

State officials say it’s better for insurers and consumers if the work is done locally and not left to Washington.

For now, Arizona is among six states where the federal government conducts the rate increase reviews required under the overhaul.

The state already reviews individual policy rates under its own standards but is seeking federal authorization, which has been granted to 44 other states, to perform reviews based on stricter federal criteria.

The Arizona Department of Insurance says state-level reviews provide both insurers and consumers with easier access to regulators.

The approach is similar to one taken by Brewer’s administration, despite opposition from some conservatives, on the overhaul’s separate requirement for creation of a state health care exchange, which will serve as marketplaces for consumers to buy insurance.

A major health insurer supports the department’s proposal, a spokeswoman said Wednesday.

“Blue Cross Blue Shield of Arizona believes that having local oversight from the Department of Insurance is an important protection and it does take into consideration the local Arizona market,” spokeswoman Renee Hunt said. “Basically, Arizona knows Arizona best.”

Consumer advocates who attended a public hearing on the department’s proposal didn’t object to the state conducting the reviews, but several said the state must make the process more transparent and give a bigger voice to consumers.

Transparency is a big part of the federal law, “yet I don’t see that embedded as part of this rule,” said Diane Brown, executive director of Arizona Public Interest Research Group.

The trigger for the federally-required reviews is a proposed rate increase of 10% or more.

And like now, Arizona’s reviews wouldn’t be for government officials to approve or reject the increases, though about half the other states have that in one form or another.

Instead, those insurers that can’t justify rate increase to Arizona regulators’ satisfaction would have to disclose on the insurers’ websites that they’re implementing increases that regulators ruled were unjustifiably high.

If the state can’t outright approve or deny rates, it should bolster the review’s provisions for transparency and consumer involvement in the process, said Matt Jewett, director of health policy for the Children’s Action Alliance.

“Make this a win-win situation,” he said. “We really need to have something that works for both consumers and insurers.”

Ellen Dean, a financial planner and insurance broker, said rate regulation is needed to avoid hefty rate increases that price consumers out of the market.

“Please protect us so that myself and my clients can continue to have health insurance coverage and take responsibility for their medical bills,” she told department officials.

Department spokeswoman Erin Klug said the agency is using part of a $1 million federal grant to improve transparency of its rate-review process to the public, with a big part being added online access to rate information.

Those changes are being planned separately from the formal rule proposal, she said.

Rate increase filings are already publicly available information, Klug said.

“Anybody can come in and get those,” she said. “That’s always been the case. (But) it’s not easy to get them because you have to make a public records request. You have to come in to the department to review them.”

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