Insurer rate cap overturned in MA

Discussion in 'Healthcare/Insurance/Govt Healthcare' started by Greenbeard, Jun 27, 2010.

  1. Greenbeard

    Greenbeard Gold Member

    Jun 20, 2010
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    New England
    Last Thursday, a new development in the friction between state government, health insurers, and providers took place in Massachusetts.

    Rate cap for insurer overturned:
    Nearly 30 states require that a state insurance official approve health insurance premium hikes and about a dozen other states require insurers to file proposed rate increases with the state in advance of the change. In recent months, controversy has arisen in multiple states over insurer requests and state government responses: in Maine a reduced increase in Anthem Blue Cross Blue Shield's rates allowed by state regulators was upheld by state courts in April; in California, Anthem backed off a proposed 39% rate increase after admitting "errors" in its calculations showing their necessity; Connecticut allowed Anthem Blue Cross Blue Shield to raise rates to a lower level than they requested (as in Maine) last year; and so on.

    The Massachusetts saga has been interesting because after regulators rejected certain premium hikes, insurers in the state briefly stopped issuing new policies. But last week's decision gets right at the issue:

    The issue namely being that providers are using market clout to drive up reimbursement rates from insurers, something suggested a few months ago in a report from the Massachusetts Attorney General's office:

    The same suggestion was brought up in a Health Affairs paper about the California market few months ago. Not too long after that came out, the Sacramento Bee published an investigation showing that California hospitals are raking in a lot more than it costs them to treat patients:

    It'll be interesting to see Massachusetts' next move.

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