Rate Shock Officially on the Exchange Board’s Radar

We appreciate OPM Secretary Ben Barnes for bringing up the subject of health insurance affordability and “Rate Shock” at this week’s CT Health Insurance Exchange Board meeting by floating the idea that legislation be passed allowing a lowering of the Medical Loss Ratio. As in other states, lowering the Medical Loss Ratio will most assuredly bring health insurance costs down. The unanimous vote of the Exchange Board finally acknowledges that the high cost of health insurance products coming onto the Exchange is a factor in the overall success in attracting Connecticut residents to the Exchange to purchase health insurance.

Now let’s hope that competitive bidding known in the industry as active purchasing also be made part of the Health Insurance Exchange’s practices. Active purchasing has a proven record of controlling health insurance costs.

Kevin Galvin, Small Business for a Healthy CT

Exchange Board Balance

In late fall of 2012 two Exchange Board seats became vacant due to resignations and a third was dropped completely with the resignation of the Special Advisor to the Governor on Health Reform. That seat no longer exists. After more than three months, one seat has been filled by Mr. Paul Philpott currently a Realtor in Connecticut and retired for the Connecticut Insurance Industry. Although I commend Mr. Philpott for his willingness to take this challenging voluntary position, Mr. Philpot is yet another person from the insurance industry on what was supposed to be a Board populated by "consumers". As of Thursday's Exchange Board meeting the "Small Business" seat has yet to be filled. This appointment has been the responsibility of State Representative Larry Cafero. It is unfortunate Representative Cafero has chosen not to make this appointment during such a critical time for our Exchange. But our legislature has given the Exchange some attention. The Insurance and Restate Committee recently voted unanimously to add a broker seat to our Exchange, a clear violation of the letter and spirit of the Affordable Care Act. Unfortunately small businesses, the largest employer in the state and nation, do not presently have a seat at Connecticut’s Health Care Exchange table.

Kevin Galvin Small Business For A Healthy Connecticut

Positive active purchasing hearing

Fifteen of the nineteen testimonies for yesterday’s Insurance Committee public hearing on SB-596 were in favor of active purchasing. Proponents included the State Comptroller, State Health Care Advocate, small business and community groups, brokers, labor, patient safety, legal aid, consumer and faith-based groups. Opponents included CBIA, the HMO Association, NFIB, and the Exchange staff. The CT Health Insurance Exchange Board and staff have rejected negotiating premiums with plans to keep costs affordable. MA’s exchange has saved consumers millions through negotiation. Utah’s exchange does not negotiate, taking any willing insurer, and premiums inside the exchange are higher than outside. Committee members asked great questions about how much consumers could save, states that are making it work, operational questions, health cost drivers and solutions, philosophical questions about the role of government, and impact on the rest of the market. The committee was especially interested that CA is planning to negotiate rates with their plans and have received 30 letters of intent from plans, countering the concern that plans would not apply. Committee members were also interested in research on how much choice is optimal for consumers before it becomes overwhelming and counter-productive.

Bills filed to fix insurance exchange and strengthen premium rate review

Sen. Joe Crisco, Co-Chair of the Insurance and Real Estate Committee, has filed bills to protect consumers in health reform. An Act Concerning the Duties of the CT Health Insurance Exchange directs the exchange to actively negotiate premiums with insurers on behalf of consumers. Other states are using negotiation to keep premiums more affordable. An Act Concerning the Insurance Department’s Review of Health Insurance Premium Rates directs the department to consider consumer out-of-pocket costs, affordability, provider rates, executive compensation in approving insurer rates and to directly monitor provider network adequacy. Both concepts are included in 31 Ways to Save Money in CT’s Health Care Budget.

CT Insurance Exchange standard plan proposal too expensive for consumers

The draft standard plan proposal for the CT Health Insurance Exchange includes copays of $40 to $45 for a physician visit (CT 2011 average $23.79), $150 ER copays, and deductibles up to $3,000 for individuals and $6,000 for families (CT 2011 average $1,331 and $2,500 respectively). Better, more affordable plans are currently available in CT on eHealthInsurance.com. It is important to note that the Exchange will be marketing their plans to CT’s uninsured, who couldn’t afford the more reasonable options available now. In what is becoming standard process for the Exchange, the proposal was developed by Exchange staff with industry insiders in non-public meetings. The draft was open for public comment until today but it was never released to the public or posted on a public website. Some Exchange Board members didn’t know anything about the process. Click here for our comments.

Mickey Herbert joins Harvard Pilgrim

Former ConnectiCare CEO, Mickey Herbert, has joined Harvard Pilgrim Health Care as a consultant. Harvard Pilgrim has applied for a license to expand to CT’s insurance marketplace. He resigned from the CT Health Insurance Exchange Board a month ago, adding to growing conflict of interest concerns. Concerns have been raised about Board members ties to and investments in insurance companies despite strong conflict of interest limits in state law.

Five large CT insurers interested in exchange

Aetna, Anthem, ConnectiCare, HealthyCT (the new nonprofit co-op plan), and United all sent letters of intent to the CT Health Insurance Exchange signaling their intent to participate. The other large insurer in the state, CIGNA, does not participate in CT’s individual market, according to exchange staff. Harvard Pilgrim did not submit a letter, but may be awaiting licensure. While not binding, the response is very good. As advocates predicted, there was little need to worry about insurers not participating in the exchange. Advocates have criticized the exchange for designing policies very favorable to insurers, lax in accountability, and unaffordable for consumers and small businesses.