Sebelius Warns Insurers Not To Blame Rate Hikes on Federal Reform Law

HHS Secretary Kathleen Sebelius, in a letter sent on Thursday to America's Health Insurance Plans, wrote that the Obama administration will not tolerate insurers' attributing premium increases to the health reform law and spreading "misinformation and scare tactics" about the overhaul, the AP/Boston Globe reports (Alonso-Zaldivar, AP/Boston Globe, 9/10).

The letter is a response to several premium increases proposed by insurers that blame a large portion of the hikes on the reform law.

Some insurers are asking for increases of more than 20% and attributing between one and nine percentage points of the increases to mandates in the overhaul, the Wall Street Journal reports (Adamy, Wall Street Journal, 9/10).

Sebelius noted that the reform law justifies only "minimal" rate increases of "no more than one to two percent" (Pecquet, "Healthwatch," The Hill, 9/9).

She warned that insurers could be excluded from the new health insurance exchanges created by the reform law in 2014 if they continue to blame larger increases on the overhaul.

Such a ban would block insurers from as many as 30 million potential customers.

Karen Ignagni, president of AHIP, said that the reform law is not the only reason for premium increases but added that it does contribute substantially to additional costs.

She said, "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."

Ignagni added, "It's a basic law of economics that additional benefits incur additional costs" (AP/Boston Globe, 9/10).

Robert Forster
The medical trend is substantially less than 20% this year even with the mandated benefits in that people are limiting their expendible cash in this recession. Both are lying, however, when governmental elected representatives intimidate the public and our public institutions, it is tyranny. We no longer hold freedom of speech as a core guiding principle. Threats pour from this administration--stick with the facts. Let the people decide. Rob MD
Jonas Green
HHS should threaten to sue (and then actually follow through) any insurer that falsely advertises on this point. If the real percentage is greater than 1-2%, why isn't AHIP releasing that number? Perhaps because it is substantially less than 20%?
Hatti Hamlin
So, I guess we just accept the government's estimates that the costs of: a) no lifetime caps; b)allowing kids to stay on policies until 26; c) mandated acceptance of all pre-existing conditions AT NO INCREASED PREMIUMS; d) no charge for preventive care and; d)capping copays can all be covered in a 1-2% rate hike?? We all know the political origins of that "estimate." And now, the government wants to curtail the free speech of insurers who simply want to point out the real costs. When did we cross into the Twilight Zone, folks?
Donald Stumpp
Is there anyone who believes the AHIP spin!!?? "Additional benefits incur additional costs" says Ms. Ignagni. But how does a 1-2% increase in cost justify the 20% premium was the point Mr. Sebelius was making. That's all right AHIP, just keep throwing out the BS because some people do believe it. However, I forgot the way health insurers math works. My providers get a 1% increase and premiums go up 15%.

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