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Insurance Committee Amends Exchange Bill With One-Year Delay

by Christine Stuart | Feb 25, 2014 4:30pm
(8) Comments | Commenting has expired
Posted to: Health Care, Labor, Legal

Christine Stuart photo

Rep. Robert Megna

The Insurance and Real Estate Committee removed the teeth from a bill Tuesday that would have directed Connecticut’s insurance exchange to actively negotiate with insurance carriers to lower the cost of monthly insurance premiums.

The amendment proposed by state Rep. Rob Sampson, R-Wolcott, delayed the requirement that the insurance exchange negotiate with carriers for one year and made it permissive, instead of mandatory. The amendment was adopted on a voice vote and became part of the bill, which was later approved by the committee.

There’s been an ongoing controversy over whether forcing the exchange to negotiate with carriers would actually result in lower rates for customers. Advocates believe the six states that actively negotiate do much better than states that don’t, but some lawmakers believe there’s enough checks and balances in place with the scrutiny of the actuaries at the state Insurance Department.

Sampson said the exchange already has great authority over who can participate in the exchange and the Insurance Department did a good job of getting the rates lowered during the first year of the exchange. He said he understands the desire of advocates to reduce the monthly premiums, but doesn’t believe forcing the exchange to negotiate will yield better results.

“The question is where do those insurance premiums come from and how will this actually impact those premiums?” Sampson said. “I would argue the cost of insurance is most affected by the cost of healthcare, which this has no effect on whatsoever.”

In September, the White House released a report that showed Connecticut will have the 4th highest premiums in the country.

Access Health CT CEO Kevin Counihan has said that might have something to do with the fact that Connecticut “currently has the 4th highest medical costs in the U.S.” However, advocates say some is attributed to the decision not to negotiate with insurance carriers.

Ellen Andrews, executive director of the CT Health Policy Project, said she was very disappointed in the committee’s decision Tuesday to change the bill.

“It sends a strong signal to the HMO’s—Don’t worry nobody’s going to be trying to get your premiums down,” Andrews said in a phone interview.

Negotiating with the carriers “just makes sense,” she said. “Understandably, HMOs don’t want that happening.”

Under the amended bill, the Connecticut insurance exchange, is not required to negotiate, but Rep. Robert Megna, D-New Haven, said the exchange can decide to negotiate if that’s what it wants to do.

“In the past the exchange has expressed concerns about this bill when it was in front of the committee last year,” Megna said.

This year Access Health CT did not submit any written testimony or take a position on the bill. The Access Health CT Board of directors voted against the idea of negotiating with insurance carriers back in November 2012.

The amended bill wouldn’t impact the rate setting process for 2015 and Megna said he doesn’t know why anyone would want to “throw a wrench in the process” at this point.

But what Megna considers a wrench, advocates considered a negotiating a tool to help improve competition in the marketplace.

“What’s wrong with getting a better deal?” Andrews asked.

But the state Insurance Department called the original bill “unnecessary.”

“The existing premium rate review and approval process through the Connecticut Insurance Department has been successful and is working well. It is the Department’s position that no change is needed at this time,” the Insurance Department wrote in its testimony to the committee.

Christine Stuart photo Keith Stover, a lobbyist for the Connecticut Association of Health Plans, said that the original bill was “without question a solution in search of a problem.”

He said with the medical loss ratios being regulated there’s no extras being added to the cost of a monthly premium. He said insurance carriers are working every day to lower medical costs by aligning provider networks and numerous other things to lower the cost of medical care.

“There are constant negotiations,” Stover said. “Every insurer is trying to figure out the secret sauce of how do you crank down costs.”

Rep. Mike Alberts, R-Woodstock , said the original bill was “like asking for the largest hot fudge sundae you can get that’s going to be free and without calories.”

He said his concern was that they’ve not setting up two systems of rate setting. The Insurance Department’s actuaries are required to look at the rates submitted by all the carriers.

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(8) Comments

posted by: Noteworthy | February 25, 2014  5:03pm

Wait just a minute - I thought I just saw an ad by the Insurance Department that said they were an advocate for us - the citizens. This move isn’t advocacy; it saves us no money. It saves the insurance industry money which is the primary result of the CT Insurance Department. The CID should take down their marketing - it’s false advertising. The television ad should have said: “We advocate you pay higher premiums and we support the lobbying efforts of the special interests.” If you want real advocacy - call the Office of Healthcare Advocate. What they do for us is even in their name - and come to think of it, so is the CT INSURANCE Department.

posted by: art vandelay | February 25, 2014  11:55pm

art vandelay

All is going according to plan. Obamacare is so bad that the only way to save it is by a complete government takeover. It’s what Obama & the Democrats originally intended.
Even Chief Justice Roberts was duped.

posted by: gutbomb86 | February 26, 2014  10:35am

gutbomb86

@art - you can go ahead and keep blathering that to all of us who signed up and now have insurance for the first time as long as you want, but you saying it doesn’t actually mean anything. Nor does it reflect well on your grasp of reality.

posted by: CtGasGuy | February 26, 2014  1:19pm

This is so typical of Hartford - what is the HARM is any to REQUIRE the exchange to negotiate - have they never heard of checks and balances.

Just another way for the exchange to say don’t blame us - This stuff really has to stop and we should all be outraged against any legislator who supported this - common sense needs to prevail.

posted by: art vandelay | February 27, 2014  6:56am

art vandelay

@Gutbomb86,
You may have insurance on PAPER which is great. The question is how will it work if and when you have to use it.  If you think private insurance is bad, wait till you have to deal with the government.

posted by: art vandelay | February 27, 2014  7:51am

art vandelay

@Gutbomb86,
FYI:  There are 8 Levels of Control to the ultimate Socialist State, the one that the Democrats in Connecticut and this nation embrace.

1. HEALTHCARE - Control Healthcare and you control the people.

2. POVERTY - Increase the poverty level as high as possible. Poor people are easier to control & will not fight back if you provide everything for them to live.

3. DEBT - Increase the debt to an unsustainable level. This way taxes can forever be increased to bring more people into the circle of poverty.

4. GUN CONTROL - Remove the ability for people to protect themselves from government. A police state can then be created.

5.  WELFARE - Take control of every aspect of peoples lives (food housing & income)

6. EDUCATION - Take control of what people read and listen to.  Take control of what children are taught in our schools

7. RELIGION - Remove the belief of God from Government & Schools.

8.  CLASS WARFARE - Divide the masses into two classes:  The haves and have nots.  This way it’s easier to tax the rich and divide it among the poor.

My guess is this is the country you wish to live in.  I don’t.

posted by: Christine Stuart | February 27, 2014  9:34am

Christine Stuart

Art,
Just to be clear we are talking about private insurance in this article. It would force the state to negotiate the price of premiums of those private insurance companies down for consumers.
Christine

posted by: art vandelay | February 27, 2014  10:05am

art vandelay

@Christine,
Yes for NOW I agree with your comment.  The current “Exchange-Obamacare” is purposely designed to implode and fail. Once this happens a single payer system will emerge which was Obamacare’s ultimate goal. Make no doubt about it that Obama and most of the Democratic leaders in Hartford are Socialists.  Kindly review Level 1 of my 8 and I make my point.  You have to look at the entire picture and not just the present.