Indiana is Cracking Down on Unreasonable Health Insurance Premium Hikes
For too long, insurance companies in many States have increased health insurance premiums with little oversight, transparency, or public accountability. Some States have both the authority and the capacity to review insurers’ proposed health insurance premium increases. Just 26 States and the District of Columbia have the authority to reject a proposed increase that is excessive, lacks justification or exceeds certain standards. Many do not, and some who have the authority lack the right tools to exercise that authority to reject excessive premium increases. This lack of authority and resources for States has unfortunately contributed to unjustified premium increases. Health insurance premiums have doubled on average over the last 10 years, much faster than wages and inflation, putting coverage out of reach for millions of Americans and business owners.
The Affordable Care Act provides States with $250 million in Health Insurance Premium Review Grants over five years to help states like Indiana help transform the way they review proposed health insurance premium increases, take action against insurers seeking unreasonable rate hikes, and ensure consumers receive value for their premium dollars.
On August 16, the Department of Health and Human Services announced the award of $46 million in the first round of these grants, including $1 million for Indiana. The following is a general summary of how Indiana intends to use its funding:
- Improve the Review Process: Indiana currently prospectively reviews all premium increases. The State will improve the rigor of its current review process by acquiring contracted actuarial support. Additionally, Indiana will conduct a study to identify best review practices across States and identify areas where existing regulations and legislation can be strengthened.
- Increase Transparency and Accessibility: Health insurance premium filings are currently only available upon request. Indiana will develop a consumer website that will provide complete rate filings and high level filing summaries. Consumers will be able to post comments on proposed rate increases directly on the site.
- Develop and Upgrade Technology: Indiana will upgrade its systems to improve efficiency and streamline data sharing.
The Health Insurance Premium Review Grants are one element of a broad effort under the Affordable Care Act to reduce the unsustainable rates of increase proposed by some insurers today. Additional resources from this $250 million program for rate review will be available in subsequent years to further strengthen State health insurance premium review procedures.