I am writing today to announce the closure of the New Mexico Independent. After three and a half years of operation in New Mexico, the board of the American Independent News Network, has decided to shift publication of its news…
While environmental activists played their part yesterday during demonstrations at the capitol building, going so far as to dress up as solar panels and to sing the tune of “You Are My Sunshine,” their counterparts, the anti-cap-and-trade contingency who has…
Roughly one quarter of University of New Mexico students are unimpressed with the state’s flagship public school, according to a survey that questioned college students about their higher education experiences.
New Mexico could get more help with reviewing rate hike requests from health insurance companies if it gets a $1 million grant the federal government is offering to strengthen oversight of the process.
Outgoing interim Insurance Superintendent Craig Dunbar told The Independent that the New Mexico Insurance Division will apply for the grant if Gov. Bill Richardson approves.
Richardson’s office did not respond to an e-mail Wednesday asking if he supported seeking the federal money.
The money would come from a pool of $51 million in federal grant funds announced this week by U.S. Health and Human Services Secretary Kathleen Sebelius. Sibelius said in a news release that the grant money is meant to help protect consumers and small businesses from “unreasonable” insurance rate increases.
“By strengthening oversight of insurance premiums, these grants will help put affordable coverage back within the reach for Americans who have been hit hard by skyrocketing costs,” Sibelius said.
Insurance Division took heat for approving recent rate hike
The $1 million grant, should New Mexico win it, would come at a time when some state lawmakers and officials already are trying to change how New Mexico’s regulators deal with requests from companies who want to raise their rates.
The sudden burst of scrutiny surrounding how the state reviews health insurers’ rate hike requests coalesced in April, after the Insurance Division approved a 21 percent increase in the premiums 40,000 New Mexicans pay to Blue Cross Blue Shield New Mexico.
The way the agency arrived at the decision has provoked questions from consumers and state lawmakers alike. The Independent’s examination of state records revealed that Blue Cross Blue Shield of New Mexico did not provide documentation for financial losses and expense figures cited as justification for its rate hike request. Records also showed that the state Insurance Division had approved Blue Cross and Blue Shield rate hike requests in each year going back to 2004.
Meanwhile, a check of Illinois state records showed that top officials at Blue Cross Blue Shield’s parent company made millions in bonuses in each of the last two years.
Rate review process does not adequately protect the public interest, some say
Officials on Wednesday were already envisioning how the state could use the money to improve the rate review process.
“They (Insurance Div) need to take a look at streamlining the process and improving public transparency,” Public Regulation Commission Chairman David King told The Independent in an e-mail.
Added Sen. Dede Feldman, D-Albuquerque: ” They need to beef up the whole process.”
Feldman recently conveyed to federal officials at Health and Human Services Department seeking public input her thoughts on how insufficient New Mexico’s rate-review process is.
Feldman wrote:
“New Mexico’s methodologies do not take into account any balancing of the public’s interest versus the insurer; it does not require disclosure of executive compensation or broker incentives to avoid higher-risk customers. They do not allow consideration of excessive profits, reserves or the rate increase’s proportion to the health care cost index. It also does not allow consideration of the insurer’s practice of isolating plan enrollees into segregated closed plans or ”blocks” that exclude newer, potentially healthier populations and retain the individuals who face increasing premiums as members of that block age or develop illnesses.”
The Public Regulation Commission has since ordered the Insurance Division to suspend approval of Blue Cross Blue Shield’s premium increase; after which the company indicated it might sue.
Insurance Division Agency officials, meanwhile, have defended the way the agency reached its decision, saying state law doesn’t empower the agency to consider certain factors when reviewing a rate request, including how much a company keeps in a surplus account, executive compensation or the practice known as “closed blocking.”
That has led some state lawmakers to speak of changing state law to give the agency more latitude and power while others have talked of giving the New Mexico Public Regulation Commission final say over health insurers’ rate hike rather than the Insurance Division.
