Health Insurers Justify Premium Hikes
by Rudolph Yap in Health News on Dec 26, 2010
Health insurers are now asked to give justifications on the large premium hikes they have installed. The Obama administration, in particular, is now requiring health insurers to give justifications on their increase of more than 10% a year starting this 2011. They also are planning to set up federal review of premiums, that is, if state regulators cannot adequately protect consumers.
Moreover, if health insurers whose rate increases are supposed to be unjustifiable to the federal officials, then they would be required to give or provide written justifications that would be posted on the federal government’s official website. This is done so to guide consumers and other benefactors of the large hikes going on in right now.
Kathereine Sebelius, the Secretary of Health and Human Services stated, “Ultimately, we know that the bright light of sunshine convinces more insurers to think twice and check their math before submitting large rate hikes.” She emphasized, “This is our latest step to put consumers back in charge of their own healthcare.”
Some of the insurance companies justify that their rate hikes are pushed by the rising cost of healthcare. However, Karen Ignagni of America’s Health Insurance Plans, has criticized the 10% threshold as unrealistic. She stated, “It does not adequately factor in all of the components that determine premiums, including the cost of new benefit mandates and the impact of younger and healthier people dropping coverage.”
Because of this event, after 2011, the federal officials are planning to develop new state-to-state criteria in assessing rate increases.
Related Posts:
