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.
The state Division of Insurance, and the Public Regulation Commission (PRC), will seek legislation this coming session that would grant new, strengthened regulatory powers to vet premium rate hike requests from health insurers.
If passed, the new powers would allow the insurance agency to consider an insurer’s investment income, surplus and cost containment and an insurer’s overall profitability rather than just the profitability of a particular line of insurance when assessing a health insurer’s rate request, according to a document State Insurance Superintendent John Franchini handed out to state lawmakers during a legislative meeting Wednesday.
Franchini appeared before the Legislature’s Health and Human Services Committee to tell state lawmakers of the proposals he, his agency and the PRC hope state lawmakers will approve during the 60-day session that starts in January.
“That is a big deal,” said Sen. Dede Feldman, D-Albuquerque, vice-chairman of the Health and Human Services Committee. “That is to their credit.”
The move to change law comes as some state lawmakers and officials already are trying to change how New Mexico’s insurance regulators deal with requests from companies that want to raise their rates. It also comes as New Mexico, like every other state, is responding to the nation’s federal health care law, which will allow states to deny “unreasonable” rate requests.
The scrutiny surrounding the Insurance Division coalesced in April after a previous Insurance Superintendent approved a 21 percent increase in the premiums 40,000 New Mexicans pay to Blue Cross Blue Shield New Mexico.
The way the insurance agency arrived at the decision provoked questions from consumers and state lawmakers alike, many of whom questioned whether the agency did an in-depth analysis of the health insurer’s rate filing, including questioning the company’s finances.
In fact, auditors for a national accrediting organization reviewing the New Mexico Division of Insurance this spring found an inexperienced, marginally trained staff often incapable of performing in-depth analysis of insurance filings, according to a June 24 draft reportobtained by The Independent.
The auditors from the National Association of Insurance Commissioners (NAIC) also were sharply critical of how New Mexico regulators have overseen the insurance industry, the report shows.
Insurance Division officials, however, argued during the controversy that the state law didn’t allow them to dig into a company’s finances, including its surpluses, as critics wanted.
Eventually the superintendent’s approval of the Blue Cross Blue Shield New Mexico rate hike was suspended after the PRC asked an interim superintendent to reconsider the case. The interim superintendent had stepped in to fill in after the resignation of the superintendent at the time of the BCBS decision.
Other pieces of legislation being considered by the PRC, which supervises the Insurance superintendent, includes making rate filings public and to require the Insurance Division to post rate filings on its website, according to the document.
The Insurance division also will hire four new people soon — a hearing officer, a financial analyst, consumer analyst and an information technology analyst to work on the Insurance Division’s web design and web site, according to a separate document also handed out Wednesday.
The new hires, as well as actuarial and website development contracts the Insurance Division hopes to let soon, will be paid for by $1 million in federal health care dollars the state won in August.
Not contained in any proposals Wednesday were other ideas percolating in the lead up to the legislative session as a result of the controversy that erupted over the Blue Cross Blue Shield episode.
Those include giving the PRC appellate power over insurance superintendent’s decisions in rate hike cases and of moving the insurance division out from under the PRC.
While the Insurance Division falls under the PRC, and the commission supervises the Insurance Superintendent, the commission doesn’t regulate the insurance industry. That falls to the Insurance Superintendent alone.
Some PRC members already have come out in support of putting the making the commission the appellate body for insurance rate hike decision. Right now challenges go to state district court.
That would require a change to state law.
Meanwhile moving the insurance agency out from under the PRC, which was organized by constitutional amendment, would require a new constitutional amendment, and hence New Mexico voters’ approval in 2012. That means it’d be two years before any change could happen, even if the idea clears every other hurdle.
Sen. Linda Lopez, D-Albuquerque, who attended Wednesday’s meeting, alluded to the ongoing conversation on what to do with the Insurance Division.
“Where the superintendent goes, who’d be the authorizing agency — there’s still a lot of ideas out there,” said Lopez, who is a member the Legislature’s Government Restructuring Task Force. “There still may be more changes when we get to the session.”
