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 hasn’t had much experience with rejecting health insurers’ rate requests—but Massachusetts, which is a potential model for New Mexico’s federally-mandated health insurance exchange—had had plenty of such experience this year.
In April Massachusetts, which created the nation’s first health insurance exchange, rejected 235 of 274 proposed premium increases requested by health insurers who offered plans on the state’s health insurance exchange.
Massachusetts’ action opens a window into the questions and issues New Mexico might encounter if it strengthens its authority to reject health insurance rate requests prior to 2014, when the federal health care law empowers states to reject unreasonable premium rate increases.
The affected insurers in Massachusetts immediately filed a court challenge and a debate has grown in Massachusetts over the past two months over whether the sitting governor, Deval Patrick, was playing politics in an election year. Last month a Massachusetts state judge refused to overturn the state’s rejections, saying that insurers had not exhausted the state’s administrative appeal process.
Massachusetts’ rejections marked the first time the state has used its authority to turn down health premium increases, according to the Boston Globe.
In Massachusetts’ case, regulators turned down the majority of premium increases because they came in above the 7.7 percent hike the state was comfortable with, according to the Globe. The paper reported that insurers had proposed base rate increases averaging 8 percent to 32 percent for hundreds of separate products, offering different mixes of benefit designs, copays, and deductibles.
Massachusetts plans with rejected rates were not available on the exchange
But in one important way, Massachusetts’ situation differs from New Mexico.
While the confrontation between Massachusetts and the health insurers has played out in the courtroom, it also has played out on Massachusetts’ first-in-the-nation health insurance exchange, said Tom Dehner of Health Management Associates and Massachusetts’ former Medicaid director.
Dehner sat on the board that governed Massachusetts’ health insurance exchange, known as the Commonwealth Connector, until he left that job to go into the private sector.
“The effect of the situation as it evolved was that the plans on the exchange without approved rates were not choices for a consumer,” Dehner told The Independent via e-mail. “The insurers themselves retained a ‘seal of approval’ that allowed them to participate on the exchange, but for a consumer seeking insurance to begin, say, in June, only insurers with approved rates for the Connector to quote were, from that perspective, ‘there.’”
Dehner went on to write that “One insurer has settled with the state (Massachusetts) at a lower increase than proposed. The others right now are offering plans on the exchange at their “old” rates (and expecting to lose money as a result, and still hoping to get court relief).”
Government officials, health insurers and advocates across the nation are watching to see how the dispute between Massachusetts and the companies ends.
The federal health care law borrows greatly from the Massachusetts health insurance exchange model. In addition, it gives states the power in 2014 to reject unreasonable premium increases requested by insurers.
What ‘unreasonable’ means and who gets to decide would likely involve the usual input from lobbyists, advocates, medical professionals and the insurers themselves.
Already some New Mexico officials are advocating that the state should not wait until 2014 to define ‘unreasonable’ and should re-write law to strengthen the state’s authority to reject premium increase requests determined to be unreasonable.
At this point Massachusetts might have leverage that most other states don’t because it has a health insurance exchange.
Dehner told New Mexico officials during a presentation he gave this past Friday in Santa Fe that a state has leverage when it creates an health insurance exchange, a concept at the center of the new federal health care law that requires health insurance exchanges by 2014.
“As far as I can tell, most people thing that health insurers very much to want to do what it takes to be a plan that is part of the market that is created by this exchange,” Dehner told the crowd during Friday’s presentation. “The fact that carriers are going to want to have access to this new insurance market is a real advantage for everyone.”
