States Keep Watch Over Insurers Rate Hikes, Solvency As Overhaul Sets Roots
Massachusetts officials are imposing stricter oversight on insurers they say are financially unstable after refusing to allow them to increase premium rates, The Boston Globe reports. "State officials said they sent letters to three health insurers earlier this year asking them to accept more intense oversight and supply additional data because of concerns about their financial health.
Officials said the heightened concern is related to the fragile economy, which caused several major insurers to lose money in 2009. At least one of the letters was sent out after the state denied health premium increases for April 1, but before insurers reported first-quarter losses they blamed on the rate rejections" (Weisman, 6/11).
The Boston Herald: "In April, after imposing the controversial rate caps, Insurance Commissioner Joseph Murphy placed at least three health insurers on administrative oversight. The designation is a rarely used but important tool for the state agency, whose primary task is ensuring that insurers are solvent. Yesterday, furious health insurers said the conflicting messages - of publicly limiting their revenue by imposing rate caps, then privately telling them their businesses are in trouble - proves that the rate hike battle of this spring was politically motivated" (McConville, 6/11).
Meanwhile, in Pennsylvania regulators are eyeing nine large health insurers for "a pattern of controversial rate increases," the Philadelphia Inquirer reports. That state's governor, Ed Rendell, said "This level of increase is not about passing on increases in health spending, which average in the 5 to 10 percent range." Rendell's office announced the state would investigate the insurers because of rate hikes of up to 50 percent for some businesses. But, the Inquirer reports that officials provided no specific examples of 50-percent increases (Von Bergen, 6/10).
Also, in Georgia, insurers are expressing concerns about the overhaul, The Atlana Journal-Constitution reports. "The federal health care overhaul will open access to care but could increase people's insurance rates, said some of Georgia's top health insurance executives during a panel discussion Thursday. Several of the officials praised the intent of the changes to open up health care to millions of uninsured people. But they raised concerns that the overhaul does not address the rising costs of health care. They also worried that the influx of new patients will strain the health system in Georgia, heightening the state's shortage of doctors and stressing emergency rooms" (Schneider, 6/10).