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Tell Us What COVID-19 Is Doing to 2021 Prices: Consumer Reps to State Reguators

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Consumer representatives want health insurers to give details about how COVID-19 is affecting their proposed 2021 major medical insurance rates.

Eighteen of the reps have asked the National Association of Insurance Commissioners (NAIC) to require insurers to put specific COVID-19 impact information in their rate filings.

“General statements or premium surcharges based on uncertainty provide insufficient information for regulators and the public to evaluate,” the reps write in a letter to the NAIC’s Health Actuarial Task Force. “The inclusion of specific information — ideally alongside assumptions about the COVID-19 infection rate, assumed morbidity rate, and other data — will also help insurers demonstrate to regulators that they are adequately preparing in response to the COVID-19 crisis.”


  • The NAIC’s Health Actuarial Task Force has posted copies of public comments here, under the meeting materials tab.
  • The NAIC’s Health Insurance and Managed Care Committee has posted copies of another set of public comments here, under meeting materials tab.
  • An article about the NAIC’s work on COVID-19-related accounting rule adjustments is available here.

The NAIC is a Kansas City, Missouri-based group for state insurance regulators.

The NAIC designates people to speak for consumers in NAIC proceedings.

In the past, the NAIC opened most of its in-person meetings and conference calls to members of the public. Since the COVID-19 crisis hit, the NAIC has suspended many of its old streams of work. Regulators have been convening mainly through conference calls that are closed to the public.

Panels that have held open conference calls include the Statutory Accounting Principles Working Group and the Health Actuarial Task Force.

The Health Actuarial Task Force has posted several COVID-19-related comment letters in the Meeting Materials section for a public conference call held last week.

The consumer reps write in their later that uncertainty related to COVID-19 will likely lead to higher premiums in 2021.

“However, we believe that consumers would be best served by greater transparency about how much rate impact insurers expect COVID-19 to have in 2021,” the reps write.

The reps also asked for the NAIC to require health insurers to prepare multiple 2021 rate filings, to reflect different sets of assumptions about the severity of the pandemic.

Actuaries from Oliver Wyman have submitted a separate comment letter about modeling the costs of treating COVID-19.

The actuaries emphasized the high level of uncertainty surrounding cost projections.

“Ultimate infection rates and percent treated are uncertain, [with] estimates ranging from less than 1% to more than 50%,” according to Oliver Wyman.

The cost of care depends partly on what kind of health coverage the patient has, on what kinds of treatments emerge, and when treatments emerge, according to Oliver Wyman.

“We recognize this uncertainty and the challenge that insurers and state regulators face in preparing and reviewing rates for 2021,” the consumer reps write. “We are, however, concerned that consumers could face rate increases for 2021 that are out of sync with actual costs if a worst-case scenario does not materialize. Insurers may be especially prone to overprice their products in the individual market, where many enrollees receive subsidies and are relatively insulated from premium increases.”

Another NAIC panel, the Health Insurance Managed Care Committee, has scheduled an open conference call session scheduled for 1 p.m. Eastern Time Tuesday.

The committee has posted a chart that summarizes the public comment letters sent to the NAIC.

Many insurers and health care provider groups have asked the NAIC for help with insurance regulatory flexibility.

A coalition that includes America’s Health Insurance Plans, the Blue Cross and Blue Shield Association and the American Council of Life Insurers have pointed out that, now that most employees are working at home, getting “wet signatures” on paper documents is difficult. The coalition is asking the NAIC to let insurers use electronic documents to meet the current state filing requirements, and to turn in hard copies later.

A coalition of mental health care providers and the American Physical Therapy Association have asked for help with clearing away some of the remaining barriers to certain types of providers getting reimbursed for meeting with patients through telehealth systems.

— Read COVID-19 Could Cost Commercial Plans $499 Billion: Fair Healthon ThinkAdvisor.

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