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Monitoring Health Insurance Rates in Pennsylvania
Monitoring Rate Hikes, Working for Stronger Protections in Pennsylvania
Current Pennsylvania law requires that insurance rates be “reasonable, not excessive and not unfairly discriminatory." To ensure this happens, the Pennsylvania Insurance Department is tasked with reviewing proposed rate increases in the individual market (for plans sold directly to individuals or families) -- and, as of December 2011 -- to plans sold in the small group market, to small businesses with 50 or fewer employees.
Historically, there has been very little public input and transparency in this process. Here’s how the current process for reviewing rate increases works:
If an insurance company, like Highmark, wants to raise rates, they must file a request with the Pennsylvania Insurance Department. From the date they file, there is the 30 days for public comment. During the public comment period, affected policyholders and the public (including legislators) can submit their concerns and objections to the Department. There is no online form to do this -- you must "submit written or e-mail comments, suggestions or objections to Rashmi Mathur, Insurance Department, Insurance Product Regulation, 1311 Strawberry Square, Harrisburg, PA 17120, email@example.com within 30 days after publication of this notice in the Pennsylvania Bulletin."
Once the 30 day period for public comment is over, the Insurance Commissioner has 45 days to decide whether or not the rate increase can take effect. Even though current law allows for “public comment” before a rate increase is approved, the public does not have the right or the ability to demand a hearing. The Insurance Commissioner can call one at his discretion, but the Department has generally refused to do that. In fact, the PA Insurance Department has not held a single hearing on a proposed rate increase in 10 years. This leaves the public with no way to prove that a proposed increase is unreasonable, excessive and unfairly discriminatory--the standard established in current state law.
Our current rate review system leaves policyholders getting hit by these increases in the dark, not knowing that they can voice their objections or where to go to do that. Further, the process does not require insurance companies to answer any of the questions or concerns that policyholders raise. The public can ask questions, but we don’t have a right to get any answers. That's led to repeatedly high rate hikes, approved without getting any public scrutiny, which has hurt working families and small businesses in Pennsylvania.
Pennsylvania needs to enact stronger rate protections to keep health insurance rates reasonable, and give the public a meaningful voice in challenging excessive and damaging rate hikes. Legislators could look to the model of the Public Utility Commission, where the public has:
- a right to a fair and open process where they can ask questions and get answers,
- a consumer and small business advocate who can intervene, and
- the right to discovery, cross-examination, an independent judge and the right to receive a written decision.
- For more on the rate review process for health insurance vs. utilities, see: http://www.pahealthaccess.org/sites/pahealthaccess.org/files/How-Health-Insurance%20Rates-Are-Set.pdf (Prepared by Lance Haver, Consumer Advocate in the Mayor’s Office of Consumer Affairs in Philadelphia).
PHAN will continue to advocate for legislative and policy changes that:
- increase transparency in how rates are set and approved,
- create a real process that gives all policyholders the right to challenge proposed rate increases,
- clearly define standards to determine what constitutes an ‘unreasonable’ rate increase.
Health insurance is too important and too expensive to allow insurance companies to raise rates without reason. We need stronger oversight and real accountability to protect working families and small businesses from having to absorb these rate hikes year after year.
WHAT YOU CAN DO:
- Talk to your state legislators about the need for real rate protections in Pennsylvania. Find their information here. Be sure to tell them how your insurance rates have risen (if you’re covered, or if you’re not--tell them how you’ve struggled to find affordable coverage options because the rates are so high). Contact the PHAN organizer in your area to set up or prepare for a meeting with your local legislators.
- Join our grassroots advocacy efforts in your area. Help us lead the fight in your community by attending and organizing rallies, writing letters to the editor, tabling at events in the community, and much more to get the word out on what we’re doing and how folks can get involved.
In the East, contact: Athena Ford, firstname.lastname@example.org or 267-257-6968
In the West, contact: Erin Gill-Ninehouser, email@example.com or 412-512-9225