HHS Warns Insurers Against Pinning High Rate Increases on Reforms

HHS Secretary Kathleen Sibelius said HHS would monitor health insurers who make "unjustified" rate increases attributed to mandates in the healthcare reform law, according to a report by the Wall Street Journal.

The announcement appeared to be in reaction to an earlier report in the Wall Street Journal that some insurers were blaming as much as nine percentage points of proposed rate increases to recently required benefit mandates under the law, such as letting children stay on their parents' insurance policies until age 26.

The Obama administration had predicted premiums would rise no more than 2 percent on average due to the new mandates, which also include eliminating co-payments for preventive care, covering children regardless of pre-existing conditions and eliminating lifetime coverage caps.

"There will be zero tolerance for this type of misinformation and unjustified rate increases," Sec. Sebelius wrote in a letter to America's Health Insurance Plans. "We will not stand idly by as insurers blame their premium hikes and increased profits on the requirement that they provide consumers with basic protections."

Citing a rule in the new law, Sec. Sebelius said insurers who unfairly raise rates would be barred from new state-run insurance exchanges to be launched by the reform law in 2014.

Karen Ignagni, president of America's Health Insurance Plans, indicated the rate increases were justified. "Health insurance premiums are increasing because of soaring prices for medical services, the impact of younger and healthier people dropping their insurance during the weak economy, and additional benefits required under the new law," she told the Hill.

Read the Wall Street Journal report on health insurance.

Read more coverage about health insurance rate hikes:

- New Health Insurance Rate Hikes Partly Due to Healthcare Reform

- For First Time, Employers Passing on All Health Insurance Increases to Employees

- Anthem Gets California's OK for Higher Rates, Having Backed Off Startling Rate Increase that Influenced Reform Debate

HHS Secretary Kathleen Sibelius said HHS would monitor health insurers who make "unjustified" rate increases attributed to mandates in the healthcare reform law, according to a report by the Wall Street Journal.


The announcement appeared to be in reaction to an earlier report in the Wall Street Journal that some insurers were blaming as much as nine percentage points of proposed rate increases to recently required benefit mandates under the law, such as letting children stay on their parents' insurance policies until age 26.

The Obama administration had predicted premiums would rise no more than 2 percent on average due to the new mandates, which also include eliminating co-payments for preventive care, covering children regardless of pre-existing conditions and eliminating lifetime coverage caps.

"There will be zero tolerance for this type of misinformation and unjustified rate increases," Sec. Sebelius wrote in a letter to America's Health Insurance Plans. "We will not stand idly by as insurers blame their premium hikes and increased profits on the requirement that they provide consumers with basic protections."

Citing a rule in the new law, Sec. Sebelius said insurers who unfairly raise rates would be barred from new state-run insurance exchanges to be launched by the reform law in 2014.

Karen Ignagni, president of America's Health Insurance Plans, indicated the rate increases were justified. "Health insurance premiums are increasing because of soaring prices for medical services, the impact of younger and healthier people dropping their insurance during the weak economy, and additional benefits required under the new law," she told the Hill.

Read the Wall Street Journal report on health insurance.

Read more coverage about health insurance rate hikes:

- New Health Insurance Rate Hikes Partly Due to Healthcare Reform

- For First Time, Employers Passing on All Health Insurance Increases to Employees

- Anthem Gets California's OK for Higher Rates, Having Backed Off Startling Rate Increase that Influenced Reform Debate

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