Many health insurers say that they have suffered huge losses on the sale of individual health coverage under Affordable Care Act rules since 2014.
Those insurers say they need to cut benefits and raise prices sharply, as soon as possible, or reduce or eliminate sales of individual coverage.
Regulators at the Centers for Consumer Information & Insurance Oversight, the federal agency directly responsible for running ACA programs that affect commercial health insurance, still think at least some proposed increases are unreasonable.
Samara Lorenz, director of the CCIIO oversight group, talks about how an issuer has to tell the public about its unreasonable health insurance rate increases in a new bulletin posted on the Web.
CCIIO is part the Centers for Medicare & Medicaid Services, which in turn is part of the U.S. Department of Health and Human Services.
The ACA requires each state to set up an effective health insurance rate review program or else let federal regulators handle rate reviews.
Some states let insurance regulators reject or change rate increase proposals.
The ACA does not give rate review programs that authority. All the programs can do is publicize which issuers have implemented increases that appear to be unreasonable.
Federal regulations now require rate reviewers to check all proposed annual increases over 10 percent for reasonableness. Regulators only have to look to see whether proposed rates are too high to be reasonable; regulators do not have to check to see whether proposed rates are too low to be sustainable.
In some cases, CCIIO have asked rate reviewers to follow policies based on the assumption that complicated ACA rules and programs would work as expected. Just a year ago, for example, CCIIO officials were still telling insurance regulators to assume that an ACA risk corridors program, which was supposed to shift cash from thriving ACA exchange issuers to struggling issuers, would make good on its obligations to the struggling issuers. A week later, CCIIO told regulators the program could pay only 13 cents on the dollar.
CCIIO is still applying the ACA requirements for telling the public if regulators believe the premiums a health coverage issuer is charging are unreasonable.
For three peeks at the unreasonableness information posting requirements in the new CCIIO bulletin, read on:
The health rate unreasonableness information has to show up on the front door to the issuer’s digital home. (Photo: Thinkstock)
1. The issuer has to put an obvious link to the unreasonableness information on its home page.
Affordable Care Act rate review regulations set by the Health and Human Services secretary require a health coverage issuer to warn the public about use of unreasonable rates within 10 business days of implementing the increase, or 10 business days after the rate reviewers make their final determination, Lorenz writes.
The issuer then has to send a final justification of its unreasonable rates to the Centers for Medicare & Medicaid Services, Lorenz says.