Step to lower insurance rate
The Affordable Health Care Act, aka Obamacare, has been the fulcrum of the nation's polarized political debate since it first started moving through Congress in 2009.
Much of that debate has been about the major components of the bill, especially the "individual mandate" to acquire health insurance that was upheld this summer by the Supreme Court.
But some of the lesser-known elements of the bill have begun to take effect. According to the nonpartisan, nonprofit Kaiser Family Foundation, one of them has had a significant impact on slowing the rate of premium increases for health care insurance.
Since Sept. 1, 2011, states have been required by the law to conduct reviews when health insurers propose rate requests greater than 10 percent. In some states, reviews are triggered by requests lower than 10 percent. And in cases where states do not establish rate review, it is done by the U.S. Department of Health and Human Services.
Kaiser examined 798 rate filings from 42 states and 48 other cases reviewed by HHS. It found that the reviews have helped to slow the rate of increases in several ways:
n In the cases actually reviewed, proposed rates were reduced by an average of 1.4 percentage points. (Pennsylvania regulators reviewed 15 rate requests averaging 8.1 percent, reducing the average rate increase to 7.7 percent.)
n The prospect of rate reviews for large increases prompted many insurers to adopt smaller increases in order to avoid the public reviews.
Regardless of the federal law's ultimate fate, states should retain rate review as a tool to slow the rate of increase for health care coverage.