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Should health insurance premiums be regulated?

Federal legislators have found a major hole in the regulation of health insurance premiums before the new health care reform takes effect. This hole could lead to even more dramatic increase in premiums than the 39% increase announced by Anthem in California in February as the health care law was being debated in Congress. Missing from that law is the ability to regulate unreasonable or unjustified rate increases by the federal government.

Unfortunately, even with all the time spent debating the health care bill, no one thought to add a protection for consumers prior to the start date of the new exchanges for purchasing health insurance in 2014, so the old rules will stay in effect and health insurance companies can quickly jack up rates between now and then. Sounds very similar to what happened with credit card rates before the new CARD act took effect in February.

Sen. Diane Feinstein noticed the hole when Anthem announced its 39% increase in February but, because of procedural rules, could not add an amendment to the bill, so instead she’s introduced the “Health Rate Authority Act of 2010″ to make it possible for the federal government to block unreasonable premium increases. During the hearing, Feinstein said, “I am concerned that health insurance companies will continue to do what they have done for far too long: put their profits ahead of people.

This entry was posted on Monday, May 3rd, 2010 at 8:16 am and is filed under Health Insurance. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

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