Here’s a tweet from state Sen. Hollis French that caught my eye:
Parnell administration does nothing to reduce health insurance costs for Alaskans, then complains about the results. http://t.co/IvRpbM5K7N
— Sen. Hollis French (@SenHollisFrench) September 8, 2014
French is responding to the recent politicized announcement that rates for those covered under individual plans through Premera Blue Cross are going to increase next year by as much as 37 percent. As Dermot Cole pointed out in his ADN column, there doesn’t appear to be public information available to justify the rates. Nor does it appear that the state has any intention of negotiating the rates. And they could. In Washington State, insurers, including Premera, asked for an average of an 8.6 percent increase for next year. The Washington Commissioner of Insurance, who is consistently consumer friendly, found that the increases weren’t justified and instead only allowed a 1.9 percent increase on average.
I asked French what Gov. Sean Parnell’s adminstration could do to reduce costs. Here’s what he wrote back:
- Alaska currently does not go beyond the minimum federal standards in terms of rate review process and transparency of rate review data.
- Alaska does not have public hearings on rates.
- Alaska posts minimal information, in a form inaccessible to consumers. The Kaiser Family Foundation noted in a 2010 rate review report that Alaska is one of the least transparent States in terms of making rate review data available.
- Alaska has not taken advantage of opportunities to invest additional resources into its rate review program. The Affordable Care Act provided States with up to $250 million in grants to strengthen their rate review programs and bolster State authorities. Alaska has not accepted or applied for any grants for rate review.
Why is this important? The state remains the primary insurance regulator and rate reviewer, and with a real rate review program, the state could offer Alaskans more affordable options to shop from on the market. For example, Maryland cut the increase of its dominant insurer in half, while in Connecticut, a major insurer requesting a 12.5% increase ultimately was approved for a rate decrease. Other states around the country – including rural states like New Mexico, Arkansas, and Montana – have seen their rates increase by less than 2% or even decrease on average.
Alaska continues to refuse Medicaid expansion for working Alaskans. This means that (a) some of those people are buying into small individual pools because they need the insurance (and therefore are likely to be higher users of medical care) and (b) because the increase of no-pays at emergency rooms and hospitals causes rates to go up for insured Alaskans to offset the losses.
All of which, is, if nothing else, a reminder of what we lost when French dropped out of first his Senate race, then the governor’s race, then the lt. governor’s race.
Contact Amanda Coyne at firstname.lastname@example.org