Remember last summer when Attorney General Peter Kilmartin took the Health Insurance Commissioner to court over her decision on Blue Cross rates for individuals? Well, there are now some encouraging signs that these two government agencies are ready to patch things up.At the House Committee on Corporations meeting Tuesday, representatives from the AG’s office and the Office of the Health Insurance Commissioner (OHIC) spoke in favor of compromise legislation that would allow both agencies to continue to be involved in health insurance rate approvals under certain conditions.
At the center of the issue is the unique process that Blue Cross & Blue Shield of RI (BCBSRI) is subject to when it comes to their individual plan rates.
All Rhode Island health insurers must submit any proposed rate changes to OHIC for approval before they can take effect – an annual process called “Rate Review.” OHIC staff dig deep into the insurers’ justification for their new rates, perform their own actuarial analyses, and solicit public comment from consumers.
This Rate Review process applies to all commercial health plans, except for BCBSRI’s individual market offerings – so-called “DirectPay” plans. That’s because an antiquated law from back when BCBSRI was the only option available to a consumer who wanted to purchase a health plan direct for his or her family.
The law subjects any proposed rate changes for the DirectPay plans to a special and totally separate process that involves the AG’s office and includes a formal hearing with a hired hearing officer where any consumers wanting to speak must testify under oath. These separate processes have confused consumers – we’ve been at Rate Review public comment sessions where DirectPay subscribers have come to speak only be to shut down by the Commissioner, who legally cannot hear their comments.
But the legislation submitted by Representative Mary Duffy Messier on behalf of the AG’s office would subject all health insurers to the same process and call for a formal public hearing and notification of the AG’s office only when the requested rate increase is 10 percent or more. It also allows OHIC to still hold the less formal public input meeting even if a hearing is necessary, allowing greater consumer access to participation in the process.
The AG’s office, OHIC and Blue Cross all signaled general support for the bill when it was heard in committee on Tuesday. The bill was held for further study.
Last year, the Attorney General disagreed with the Commissioner’s decision on the DirectPay rates and took her to court. OHIC ultimately won, but the legal spat held up rate approvals.
Both the Attorney General and the Health Insurance Commissioner are working in good faith to protect consumers, and this legislation lets them both continue to have a role in rate approvals. It will strengthen consumer protection, preserve consumer access to the process, and best of all, it will finally correct an outdated law and subject all health insurers to the same fair process.