“How Health Insurance Rate Regulation Can Lower Premiums and Save Health Reform”

On Wednesday, May 11, 2011, Senator Dianne Feinstein joined Consumer Watchdog at a newsmaker briefing on Capitol Hill on what can be done in Congress, the states and by HHS to strengthen regulation of health insurance rate hikes and hold down costs under health reform.

Consumer Watchdog released our new report that analyzes rate regulation in Massachusetts, California, Maine and other states, and what works to bring down health insurance premiums.
The report’s main conclusions are:

1. The Massachusetts "mandate" that individuals purchase insurance, which was the model for federal health reform, did not control premiums. Only when Massachusetts started regulating rates did premium increases start falling.
2. States that have added or strengthened regulation, including New York, Oregon and Maine, are successfully bringing down costs.
3. California’s auto insurance regulation law, which has saved drivers $62 billion, is the model for successful oversight of what insurers charge. It requires insurance companies to open the books and prove rate increases are necessary, get regulators’ approval, and funds public challenges of excessive premium increases.
4. Since federal health reform didn’t require rate regulation, states must pass laws requiring insurers to get rates approved before they charge consumers. If states refuse, the feds should step in.

Briefing transcript.

The following are documents and recordings of that discussion.

1. Consumer Watchdog's Report:
   Health Reform and Insurance Regulation: Can’t Have One Without the Other (PDF)
2. Consumer Watchdog's comments on the HHS rate review regulation (PDF)
3. Prop 103 Savings from 1989 to 2008 – From Rosenfield's presentation (PDF)
4. Prop 103’s intervenor system has saved consumers $2 billion since 2003 (chart)
5. Insurance Superintendent Mila Kofman's presentation (PPT)