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.
The issuer also must “prominently post on its Web site” information about the increase, Lorenz says.
“Prominently post” means that the information “can be viewed on the issuer’s public web site through a clearly identifiable link or tab located on the home page, without requiring an individual to create or access an account or enter a policy number,” Lorenz says.
A consumer must be able to tell, just by looking at the link or tab, that the unreasonableness information applies to a specific product in a specific market and year, Lorenz says.
Issuers may want to make the unreasonableness information as skinny as possible. The Centers for Medicare & Medicaid Services wants to see issuers flesh it out. (Image: Thinkstock)
2. The unreasonableness information has to have some meat to it.
The unreasonableness information link on the home page must lead to a page that gives the rate reviewers’ explanation of why they believe the issuer’s rates are unreasonable.
The page must also provide a copy of the issuer’s final justification of the rates.
“The final justification should not simply restate the rationale that was included in the rate filing,” Lorenz writes. “Rather, the final justification should include a thorough explanation and analysis of the issuer’s decision to implement a rate increase determined to be unreasonable.”
The issuer should include responses to the rate reviewers’ concerns, Lorenz says.
Regulators want consumers to be able to see that an issuer imposed what regulators see as an unreasonable rate increase for years. (Image: Thinkstock)
3. The unreasonableness information has to be available to the public for at least three years.
An issuer might prefer to see the unreasonableness information pass into oblivion quickly.
Lorenz says an issuer has to keep the information available to the public on its website for at least three years.
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