Challenging Health Insurance Premium Rate Increases: Part 5 – Involving Consumers in the Rate Review Process

This is the fifth in our series of blogs that share tips and best practices from state consumer advocates about how to effectively participate in the health insurance rate review process. Previous blogs covered:

Part I: How to prepare for rate review
Part 2: First steps for advocates after rate increases are proposed
Part 3: How to critique insurers’ assumptions about future medical costs
Part 4: How to scrutinize the amounts insurers keep on hand for administrative expenses, reserves, and surpluses

What you’ll learn from this post:

This fifth and final post describes how consumer feedback can keep health insurers’ premium rate increases in check, particularly when those consumers explain why the increases are unaffordable.

The Affordable Care Act can be an advocacy tool for a more consumer-friendly rate review process

The Affordable Care Act requires states to have an “effective rate review” process in place. Specifically, for any rate increases that exceed a threshold—currently 10 percent—the Department of Health and Human Services requires states to:

• post rate increase filings on a public website
• have a public comment process on filings
• have a standard for determining when a rate request is “unreasonable”

If states don’t meet the above criteria, the law allows the federal government to step in to review rates. Most states also have laws that require a review of proposed rate increases. These laws typically give the state insurance department or commission the power to approve or reject rate increases.

Advocates can argue that affordability—how higher premiums affect consumers’ ability to afford insurance—should be a part of determining whether a rate request is unreasonable.

Insurance regulators should add affordability as a formal factor when evaluating whether to approve an insurer’s proposed rate increase

While it may seem counterintuitive, in most states the rate review process does not include affordability (the impact on current and potential enrollees’ ability to afford an increase in premiums) as a statutory requirement in determining whether a rate increase should be approved. If the insurance regulator finds other components of a proposed increase to be reasonable—such as medical cost trends, assumptions about the enrollee risk pool, administrative costs, reserves held for future expected claims, etc.—the premium rate increase is approved.

Advocates can argue, however, that affordability should factor in as well. Advocates can lobby policy makers to add affordability as a statutory requirement in the rate review process. Most state legislators will be uncomfortable opposing a law that says the rate review process should consider affordability of premiums for consumers.

Vermont offers an example of a law that requires consideration of affordability. As a result, the Green Mountain Care Board has used affordability concerns to reject double-digit rate increases.

Consumer testimony is helpful even when affordability is not part of a state’s rate review statute

Even in states that do not make affordability a required consideration, consumer testimony can keep unreasonable rate increases in check.

Collecting written or oral testimony from current and potential enrollees about affordability is an effective tactic. Advocates in every state that we interviewed report that this testimony strengthens regulators’ ability to bargain with insurers about proposed premium increases. This is the case even when affordability is not a formal factor in the review process.

For example, regulators may be concerned if there is evidence that current enrollees will drop their policies due to an unaffordable premium increase; health plans need a good-sized pool of enrollees to remain viable.

Engaging consumers in challenging rate increases: Quality, personal stories, and media make a difference

Advocates emphasize that consumer comments do not need to be numerous or technical to be effective—even a few personal stories of the potential impact on a consumer’s ability to buy insurance can be effective in challenging unreasonable increases. For example, even though New York has a consumer-friendly online tool to submit comments on rate filings, advocates with the Community Service Society of New York told us that the quality of these comments rather than quantity is what has significant impact.

Another advocate suggested that 100 comments would influence his regulators. And in one state, an advocate noted that as few as a dozen comments can make a difference.

Advocates also recommend sharing the best testimonies with the media. One suggestion was to share affordability-related comments from a high-profile influencer—a key state legislator or a high-ranking official with a university or hospital, for example—with the media. This can leverage publicity and influence regulators and insurers (insurance companies may even react to the publicity by lowering rates on their own).

How advocates are improving the rate-review posting process for consumers across the states

As we mentioned in our first blog in this series, only a few states require insurers to give enrollees notice when the insurer requests a rate increase.

In all other states, consumers are notified in a variety of ways. For example, though Connecticut requires insurers to send a letter to all current policy holders, this is an administrative policy and not statutory. In other states, consumers must visit state websites to find the information, but aren’t always able to correctly identify which increases affect them.

Following are examples of ways advocates bring a consumer perspective to the rate review process:

• In Maine, advocates were able to get a list of plan enrollees who had submitted comments or complaints to the Department of Insurance through a consumer online comment process. Using this process, advocates were able contact those enrollees about testifying at a public hearing. Maine advocates then asked other advocacy organizations to share their own lists of enrollees. And they used social media (Facebook) to reach out to the public. Advocates also made sure that consumers had a key point person to contact about the status of their plan and the rate review process.
• In Connecticut, the State Healthcare Advocate has a list of 6,000 consumers who have asked her office for help. She has cultivated this list with help from state legislators and consumer advocates, and uses it to inform consumers when rate filings are posted.
• In Vermont, the Green Mountain Care Board requires that at least two public forums be held each year to educate the public about rate review. Consumer advocates can use these forums to identify people who would be willing to submit comments on rate filings. Green Mountain Care Board Rule 2.00 § 2.201(e), page 4.
• In Colorado, advocates with Colorado Consumer Health Initiative (CCHI) have successfully engaged consumers in the rate review process. This presentationincludes a graphic that illustrates the rate review process at a glance. Advocates also used social media (Twitter) to educate the public. Matt Valeta, an advocate with CCHI, shared a Member Communications Digest on rate review with us that contains messaging tips, tweets, sample Facebook posts, and news clips.

Case study: How Oregon’s OSPIRG is improving the rate review process for consumers

Jesse Ellis O’Brien with OSPIRG shares key messaging tips for how to frame rate review to spur consumer involvement in challenging rates:

”It’s really easy to confuse people about what you’re talking about unless your initial message is very carefully calibrated. Some people may think that you’re trying to sell them insurance. Others may get distracted by the politics of the ACA, which really have almost nothing to do with state rate review programs. Some specific messaging ideas we’ve come up with to address these concerns are:

• Frame rate review as cutting waste from the health care system, not in terms of saving people money. We no longer talk about rate review in terms of saving people money, because this triggers the “selling insurance” frame. We talk, instead, about cutting waste out of the health care system. This puts rate review in its proper frame as a way of addressing the social issue of high health care costs—something people should care about even if they are happy with their own insurance.
• Talk about how much health care still costs too much in order to avoid polarizing arguments about the ACA. Early in our conversations with folks, we use the line ‘health care still costs too much.’ This is a way of cutting through the distracting ACA frame, because everyone agrees with that, regardless of their feelings about the ACA or Obama, even if they are single-payer advocates or anti-Obamacare tea party activists.
• Focus on concrete solutions to engage people who feel powerless and not inclined to get involved. Everyone agrees that high health care costs are a problem, but many people feel hopeless and powerless to do anything about it. To get them on board, you want to be able to point to specific, concrete solutions and visible progress as much as possible.”

Other tactics used by OSPIRG to help improve how consumers learn about and challenge rate increases:

• Consumers are often confused about the name of their plan and which rate filing applies to them (they may know that they have a Blue Cross/Blue Shield plan, but not the specific name of their plan, for example). OSPIRG sends email alerts about rate filings to consumers. OSPIRG is also advocating for a statutory requirement that requires insurers to inform consumers of proposed rate increases (in standardized, consumer-friendly language) and of consumers’ opportunities for input before the increase goes into effect.
• OSPIRG also used a petition to Governor Kitzhaber in support of strengthening rate review. Through various media and outreach efforts, OSPIRG has gathered 30,000 Oregonians to sign this petition in the last year.
• OSPIRG’s brochure about rate review helps simplify the issue for the public. And OSPIRG’s general brochure makes rate review a key issue for the consumer advocacy organization’s membership appeals.
• OSPIRG uses rate review as a topic for door-to-door canvassing. Canvassers hand out a fact sheet that highlights the specific examples of inflated health insurance rates as evidence of waste in the health care system and the source of unjustified costs.

What you learn about rate review can help other advocates—share your strategies with us on Twitter and Facebook

If you have tips or best practices to share, other advocates are waiting to hear from you! Please share your strategies with us through Facebook or Twitter using #ratereview2015.