Health insurance premium hikes to be reviewed

Health insurance premium hikes to be reviewed

Escalating health insurance premiums have prompted administration officials to propose new rules that will require insurance firms to explain hikes of more than ten percent annually starting 2011. State regulators have been urged to clamp down on rising insurance packages to protect the public, but administration officials said that the federal government is ready to conduct a federal review of premiums if the need arises. Consumers have decried the hike in premiums, with some areas experiencing up to 30 percent increases. The climbing rates have prompted calls to give financial regulators new powers to curb the health insurance premium hikes. If the proposal is enforced, insurers will have to provide regulators with written explanations and justifications for posting on the new website put up by the federal government.

"Ultimately, we know that the bright light of sunshine convinces more insurers to think twice and check their math before submitting large rate hikes," said Kathleen Sebelius, the U.S. Secretary of Health and Human Services, in an announcement on Tuesday. "This is our latest step to put consumers back in charge of their own healthcare." Insurance industry officials say that rising premiums have only followed increasing health care costs. America's Health Insurance Plans chief executive Karen Ignani also expressed her disfavor of the ten percent cap. "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," Ignani said. On the other hand, consumer advocacy associations welcome the new proposal saying it would help limit increases in the cost of coverage. The new healthcare law signed by President Barack Obama lets state governments exercise oversight and regulation of the insurance industry. If approved, the new rules would let the federal government help in the review process.

Posted by George Daniels on Thursday December 23 2010, 2:06 AM EST. Ref: LA Times. All trademarks acknowledged. Filed under Featured News, Health. Comments and Trackbacks closed. Follow responses: RSS 2.0