Consumer Watchdog has fought to defend central consumer protections in the health care law against efforts by lobbyists for the health insurance industry to undermine rules and create loopholes in regulations. State insurance regulators at the National Association of Insurance Commissioners (NAIC) and federal regulators at the Department of Health and Human Services began writing implementing regulations in summer of 2010.
Much of our work focused on the two consumer protection provisions in the federal health care law with the greatest potential to make health insurance more affordable for consumers.
Medical Loss Ratios: Health insurers must spend at least 80 cents of every premium dollar paid by consumers on actual health care, not administrative waste, outrageous executive salaries, or excessive profits.
Rate Review: Health insurers must publicly justify double-digit health insurance rate hikes, and regulators must determine if they are unreasonable
Below are links to and brief explanations of Consumer Watchdog comment letters sent to HHS and the NAIC, and corresponding press releases, blogs and testimony.
Health Insurance Rate Review and Regulation
A letter of support for NAIC Consumer Representatives in their request for more detailed information to determine the reasonableness of rate increases. June 29, 2010 (letter)
A letter to Secretary Sebelius asking her to reject California Governor Schwarzenegger's rate review grant application for proposing reforms that would actually hurt California's ability to regulate insurance rate increases. August 3, 2010 (letter) (press release)
This letter to a working task force at the NAIC details Consumer Watchdog's recommendations for further improvement to the rate filing disclosure form that insurers will have to complete to publicly justify an "unreasonable" rate increase. Consumer Watchdog argues for changes to the disclosure form to allow the public to determine whether unreasonable premium increases can be justified. August 11, 2010 (letter) (press release)
Letter calling on President Obama to strengthen pending rate review regulations, and take the case for prior approval of all rate increases to the states. September 14, 2010 (letter)
Consumer Watchdog writes to President Obama, calling for a rate freeze until rate review regulations are enacted. September 29, 2010 (letter)
Consumer Watchdog letter to HHS finds that draft rate review regulations fall short of full transparency or robust review of unreasonable rate hikes. The letter recommends: full public disclosure when health insurers must justify a rate hike, and review of more rate hikes so no potentially unreasonable increases escape scrutiny. February 22, 2011 (letter) (press release)
Medical Loss Ratio
A letter to Secretary Sebelius deconstructing some of the disingenuous requests by health insurer lobbyists to count administrative expenses as activities that improve health care quality. June 29, 2010 (letter) (press release)
A broad comment letter to the NAIC expressing Consumer Watchdog's positions on a variety of issues related to the conclusions of the subgroup and cautioning against radical changes to the subgroup's recommendations. August 4, 2010 (letter)
This letter expresses concern over recent changes in the NAIC's draft medical loss ratio recommendations for what to consider as Health Quality Improvements, or expenses that count toward improving a consumer's health. Objections are listed to the inclusion of "accreditation fees" and "prospective utilization review" — expenses that are purely administrative and are intended to help insurers evade the health law's requirements that insurers spend more on medical care. August 10, 2010 (letter)
This letter, co-written with the Center for Media and Democracy, urges HHS to examine in detail why major health insurers have suppressed their medical loss ratios in recent quarters in anticipation of the new MLR rules. The insurers' efforts, tantamount to a credit card company increasing rates just before a new law goes into effect limiting those rates, should be investigated immediately to mitigate harm on consumers. August 11, 2010 (letter) (press release)
Letter to HHS Secretary Kathleen Sebelius, urging her not to give in to insurer lobbying pressure to weaken health reform key consumer protections in health reform. November 10, 2010 (letter)
Medical Loss Ratio Waivers
Health insurers are lobbying to escape the medical loss ratio rule, by pressuring states to apply for exemptions. Some states rejected insurance companies' efforts to evade the requirement, others capitulated and submitted applications requesting HHS waive the requirement. Read Consumer Watchdog's blogs and letters to HHS calling for an end to the waivers, and commenting on efforts in:
Maine (blog), and
Insurance Broker Medical Loss Ratio Exemption
Insurers and the agents and brokers that sell insurance policies are pressuring regulators and Congress to gut the medical loss ratio requirement in another way — they want to protect insurer profits and broker income by excluding all payments to insurance salespeople from the 80% to 85% medical loss ratio requirement. Read Consumer Watchdog's comment letters to state regulators explaining why this change would nullify the medical spending requirement.
Letter to NAIC Professional Health Advisers Task Force. June 28, 2011 (letter)
Letter to NAIC Commissioner Praeger, Health Insurance and Managed Care Committee. May 24, 2011 (letter)
Letter to Commissioner Kevin McCarty and NAIC Professional Health Insurance Advisers Task Force. March 21, 2011 (letter)
Consumer Watchdog called on the administration to strengthen rules that give many consumers, for the first time, the right to an independent outside review of unfair denials of care by insurance companies. (press release) (chart)