Though the Obama administration has signaled that it wants states to scrutinize proposed health insurance premium hikes, insurers and even one state official have questioned the federal government's effort to intervene.
Kevin Counihan, the CEO of the federal health insurance marketplace Healthcare.gov, sent a letter late last month to state insurance commissioners asking them to take a closer look at rate increases, FierceHealthPayer has reported.
Yet Montana Insurance Commissioner Monica Lindeen, who is also the president of the National Association of Insurance Commissioners, told the New York Times that Counihan's letter "did not point to any new information that would impact how state insurance departments regulate their health insurance markets."
In addition to keeping rates affordable, some states have also had their hands full with the financial troubles of consumer operated and oriented plans (CO-OPs), the Times points out. A recent government report painted a bleak picture of the 23 current CO-OPs, noting most fell short of enrollment and profitability goals.
Counihan also argued in his letter that an improved medical loss ratio means many health insurance customers were healthier and less costly than expected, and overall medical costs remained moderate from the end of 2014 to early 2015.
Blue Cross and Blue Shield of Minnesota, however, has experienced quite the opposite, according to the Times. Its claims experience has not slowed, an official from the organization said, and the health status of its new customers have not improved, leading the insurer to request average rate increases of about 50 percent for 2016. Like many insurers, high prescription costs have also hit the health plan hard.
Meanwhile, efforts on the part of the states to negotiate lower rates have yielded mixed results. California successfully negotiated a moderate 4 percent average increase in premiums for next year, and New York officials also reduced the average rate increase from 10.4 percent to 7.1 percent. But the New York Health Plan Association says its state officials' efforts have has hurt insurers financially. "Plans cannot be expected to continue losing money year after year and remain viable," Paul F. Macielak, president of the trade group, told the Times.
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