Archive for December 27th, 2010

There are a number of provisions from the PPACA law (Health Care Reform) that will go into effect on January 1st:

  • Mandated Minimum Loss Ratios – Insurance companies will need to prove that they spend at least 80% of premiums (for Individual Health and Small Group Health Insurance) on “activities that improve care”.  NAIC has issued guidance for insurance companies on what this means, but, for the most part, these amounts are limited to payment for claims on the policy.
  • Changes to Medicare – Adds preventative benefit and 50% discount on certain Brand Name drugs in the Doughnut Hole and a 7% discount on Generic drugs in the Doughnut Hole.

The full story is covered by Insurance Broadcasting here.

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AM Best recently reviewed UnitedHealth and affirmed it’s “A” rating.  Here are details along with findings on their financial review.

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In my prior blog post, I linked to HHS’ Proposed Rule-making on Individual and Small Group Health Insurance Rate reviews.  HHS has excluded Medicare Supplement (or Medigap) policies from this regulation.  HHS has said that it intends to look at rate increases on Medicare Supplement policies in the future, but for now, the current system of state review for increases will stay intact.

The story was covered by Fox News here and also by Bret Baier in a Special Report.

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This past Thursday, HHS issued its proposed Rule on Excessive Rate increases which would mandate states to review any increases on Individual and Small Group Health Insurance which exceed 10%.  This rule specifically excludes the large group market and is not final.  There will be a comment period before HHS promulgates the final rule.

Many states already have systems in place to review proposed rate increases and have authority to deny any increases which are not justified or are deemed excessive.  This rule would mandate review about a specified threshold (10% in 2011) for all states and would involve some Federal scrutiny, in addition.

The story is covered by NAHU here.

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