House Speaker Christopher G. Donovan (D-Meriden) today told a legislative committee it is imperative to "take action to rein in health insurance companies, provide more affordable options, and protect consumers from abusive insurance company practices."
Doing so, he said, will prevent more families and businesses from being "crushed by rising health care costs. Keeping health care costs affordable will save Connecticut jobs."
Speaker Donovan made his comments before the legislative Insurance and Real Estate Committee during a public hearing on SB 194, An Act Concerning Rate Approvals for Individual Health Insurance Policies. His full testimony is attached.
The bill would eliminate the Insurance Department's ability to allow rate hikes to take effect without a public hearing; require insurance companies to notify policyholders of requests for rate increases; require insurers to disclose documentation in support of rate increases for public scrutiny; limit reasons for a rate increase and put the burden of proving that an increase is "reasonable" on the insurer; and empower the Attorney General and the state healthcare Advocate to intervene in rate cases and appeal rate decisions to the Superior Court.
Speaker Donovan cited a proposed 32% rate increase by Anthem Health Plans on individual health insurance policyholders last summer and said, "The proposed increase affected 56,000 Connecticut residents - many of whom are self-employed, work for small businesses that can't access affordable coverage, or are already suffering from unemployment."
Even after public outcry, Speaker Donovan said, the Insurance Department still approved a rate hike of up to 20% for 2010, costing residents thousands of additional dollars in insurance premiums.
"In December," he said, "the non-partisan Office of Legislative Research released a report documenting the frequency of insurance company rate requests and Insurance Department rate approvals on individual policies in the last several years. Each of the eleven most recent rate increase requests on individual policies has been approved by the Insurance Department. Eight of these proposals have been in the double-digits and nine of the requests have been approved as filed, leading many consumers and state officials to question the level of scrutiny applied by the Department in examining whether the rates are 'excessive' or 'unfairly discriminatory' as is required by statute."
Speaker Donovan said, "[This bill] offers Connecticut the opportunity to be a leader in the fight against anti-consumer and anti-small business tactics of the insurance companies."
