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HHS Issues New Grants to Help States Protect Consumers From Health Insurance Rate Increases

Grants will help states make rate review more open, thorough & fair for consumers

Thursday, February 24, 2011

HHS Issues New Grants to Help States Protect Consumers From Health Insurance Rate Increases
Grants Will Help States Make Rate Review More Open, Thorough & Fair For Consumers

WASHINGTON, D.C. – The Department of Health and Human Services announced a new round of grants today to help states do a better job of protecting consumers from soaring health insurance premiums. Sondra Roberto, staff attorney for Consumers Union, the nonprofit publisher of Consumer Reports, issued the following statement about the new HHS grants:

“We welcome this additional funding from the Affordable Care Act to help states protect consumers from excessive health insurance rate increases that so many families and small businesses have been struggling to afford. These grants will help states restrain the growth in premiums and encourage them to make rate review more open, thorough, and fair for consumers.”

“Right now, we have a patchwork of rate review rules and practices in the states. Even states that have authority to reject rate increases often lack the resources to collect sufficient data and closely analyze rate hikes. An insurer’s rate increase is always based on future projections of revenues and costs, so it is very important that these projections are analyzed to ensure that they are reasonable, fair, and based on valid data and assumptions. We hope that states receiving this funding will use it to improve data collection, standardize filing requirements, and conduct more in-depth reviews.”

“Almost all states need to provide more information to consumers about rate increases. We hope this funding will improve transparency by allowing states to provide more information to the public about past and future rate increases, where the premium dollars are going, and the reasons for a rate increase.”

“Finally, very few states currently consider the impact of these increases on consumers and very few have avenues for consumer representation and participation in the rate review process. These grants will hopefully encourage more states to open up the process to allow more public involvement and use this input to balance the hardship on consumers against the company’s need for an increase.”


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David Butler – 202-462-6262