West Virginia is Cracking Down on Unreasonable Health Insurance Premium Hikes

For too long, insurance companies in many States have increased health insurance premiums with little oversight, transparency, or public accountability.  Some States have both the authority and the capacity to review insurers’ proposed health insurance premium increases.  Just 26 States and the District of Columbia have the authority to reject a proposed increase that is excessive, lacks justification or exceeds certain standards.  Many do not, and some who have the authority lack the right tools to exercise that authority to reject excessive premium increases.  This lack of authority and resources for States has unfortunately contributed to unjustified premium increases.  Health insurance premiums have doubled on average over the last 10 years, much faster than wages and inflation, putting coverage out of reach for millions of Americans and business owners. 

The Affordable Care Act provides States with $250 million in Health Insurance Premium Review Grants over five years to help states like West Virginia help transform the way they review proposed health insurance premium increases, take action against insurers seeking unreasonable rate hikes, and ensure consumers receive value for their premium dollars. 

On August 16, the Department of Health and Human Services announced the award of $46 million in the first round of these grants, including $1 million for West Virginia.  The following is a general summary of how West Virginia intends to use its funding: 

• Improve the Review Process:  Currently, West Virginia does not use any certified actuaries to review health insurance premium filings.  The Department of Insurance will hire consulting actuaries to review current filing requirements and recommend additional data elements needed to strengthen the review process.
• Increase Transparency and Accessibility:  The State will make modifications to develop public consumer-friendly descriptions of health insurance filings.
• Develop and Upgrade Technology:  West Virginia will upgrade its information technology system to support improved reporting.

The Health Insurance Premium Review Grants are one element of a broad effort under the Affordable Care Act to reduce the unsustainable rates of increase proposed by some insurers today.  Additional resources from this $250 million program for rate review will be available in subsequent years to further strengthen State health insurance premium review procedures.

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