Health Insurance

Two reports from America's Health Insurance Plans:

AHIP testimony (available from this link) at the April 20 U.S. Senate HELP Committee hearing.   The hearing was held to examine issues around health insurance premiums and congressional interest in further regulating premiums.  

An update on activities in the states related to federal reform.  (Below)

During the Senate HELP Committee hearing, Senator Dianne Feinstein (D-CA) testified in support of her legislation, S. 3078, which would create a new Health Insurance Rate Authority and require the HHS Secretary to establish, in conjunction with the states, a uniform process for the review of “potentially unreasonable increases” in health insurance premiums.  

AHIP emphasized that its members are working hard to implement the provisions of the new health reform law.  AHIP expressed concern that the law does not do enough to address the exploding costs of health care, while noting that rising premiums are a symptom, not a cause of the problem.  AHIP pointed to government data showing that the costs associated with health insurance account for four percent of national health expenditures, and emphasized that plan profit margins – at 2.2 percent in 2008 and 3.2 percent in 2009, according to Fortune magazine – are well below those of other health care sectors.  

AHIP testified that federal and state data show that premium increases are being driven by the underlying cost of medical services and increased utilization of services.  She also discussed the situation in Massachusetts, expressing concern that state regulators are imposing arbitrary caps on premiums without any linkage to the factors that are driving premium increases, as outlined in the recent report by the Massachusetts Attorney General.  AHIP pointed out that the new federal law establishes extensive regulations for every aspect of health plan operations, including MLR requirements that cap administrative costs and plan profits, a process for the annual review of “unreasonable” increases in premiums, a requirement for plans to publicly justify premiums, and grants to ensure that the states have sufficient resources to implement these requirements.


  • Governor Action- Governor Parnell issued comments through a press release on March 21 (prior to passage) reiterating his concerns with the reforms and what he believes will be adverse impacts on consumers and small businesses.
  • Litigation/Anti-Reform Action— On April 20th, Gov. Sean Parnell announced the state will join 18 others in suing to overturn the health care overhaul bill.
  • Risk Pool Action-  The DOI has been asked to develop recommendations on interim high risk pool for the Governor.  State is expected to send response to HHS Secretary by 4/30.


  • Department Action- The Department of Insurance posted information regarding reform to its website and reassured the public that the Department will be working with other state agencies to implement reform in Arkansas.
  • Risk Pool Action— It appears the state will contract with HHS to implement the high risk pool- still working out the details.


  • Governor Action- On April 6, Governor Brewer announced they were joining the multi-state lawsuit.
  • Litigation/Anti-Reform Action --  Governor Brewer signed SB 1001 April 1, which give the Governor, Speaker Adams and Senate President Burns the authority to bring litigation against the federal government to enforce the public policy of Arizona that every person can choose to purchase or not purchase health insurance without penalty or fine. 
  • Legislative/Constitutional Action-- H.C.R. 2014, proposes to prohibit an individual mandate and will be on the November 2010 ballot.
  • Risk Pool Action—The state will most likely not participate in the development of interim high risk pool.  Governor’s office has not made final decision, but with engagement of lawsuit, collaboration on the high risk pool is probably impacted.


  • Legislative Action— There are 10 bills that have been introduced to “implement federal health reform”.  These cover Exchanges, High Risk Pools, Dependent age expansion, rate regulation, rescission and “conformity”.
  • High Risk Pool Action-- Governor’s office is still exploring options for high risk pool and the feasibility of having it run within MRMIB (current state high risk pool agency), and will be responding to HHS Secretary by 4/30.
  • Governor Action— Governor Ritter will be naming someone from his office as the point person for health care reform implementation in the state.
  • Litigation/Anti-Reform Action— Attorney General John Suthers announced in a March 22 press release that he would join the multi-state AG lawsuit.  On March 26, the Director of the Department of Health Care Policy and Finance held a briefing on the impact of federal reform on Colorado and noted that she disagreed with the AG’s decision to join the lawsuit.
  • Committee/Department Action--  On April 20 a meeting was held among industry representatives and the chairs of the House and Senate Health and Human Services Committees to discuss steps the legislature will need to take (including possibly modifying bills already in the legislature) to bring Colorado into conformity with the new federal law.


  • Governor Action- The Governor issued a press release, through Executive Order No. 43 creating a Health Care Reform Cabinet to be led by Cirsitine Vogel, Deputy Director of the Department of Public Health.  The Cabinet is responsible for providing transparent access to information, pursuing federal funds for a temporary high risk insurance pool, creating a consumer friendly health insurance purchasing exchange and reviewing insurance industry reforms to ensure Connecticut is ready for final implementation of the national law in 2014.
  • Board/Commission Action- The SustiNet Board (the state's universal health care plan) must provide access to affordable health care coverage to 98 percent of Connecticut residents by 2014. The Board must design a self-funded plan that will control costs while increasing access and submit its recommendations to the legislature by January 1, 2011 is working on implementation. Under the Sustinet enabling statute, they have 60 days from enactment of HCR to report to the legislature.
  • Risk Pool Action-  It is anticipated the state will contract with HHS.


  • Risk Pool Action- The Department plans to contract with HHS.


  • Governor Action- Governor Christ has launched a “Repeal and Reform” petition as part of his campaign for US Senate.
  • Department Action- The Florida OIR and the Florida Health Insurance Advisory Board will be holding a joint public hearing on the issues related to minimum loss ratios on May 4th.  They are seeking public input, especially on the issue of how the federal requirement will impact the individual insurance market.
  • Litigation/Anti-Reform Action-  Attorney General McCollum is leading the litigation challenge of the various state attorney’s generals seeking a court ruling declaring the federal reform efforts as unconstitutional.
  • Legislative Action- H.B. 7235 which, would attempt to prohibit the imposition of an individual mandate, is awaiting action on the House floor.


  • Litigation/Anti Reform Action- Georgia Attorney General, Thurbert Baker, a Democrat, declined the Repblican governor’s request to join the multi-state lawsuit against the federal reforms.  The Governor hired Frank Jones of Macon to participate in the suit on behalf of his office.  Mr. Jones’ title will be “Special Assistant Attorney General.”
  • Risk Pool Action-  The Department sent a letter to Secretary Sebelius saying GA  will not participate in the federal high-risk pool.
  • Governor Action- Governor Linda Lingle issued a press release on March 22 regarding her concerns with Federal health reform.


  • Governor Action-  Governor Culver issued Executive Order 23 calling on the Insurance Commissioner to provide monthly updates regarding the implementation of the Exchange and its relationship to the federally-mandated exchange and to cooperate with federal agencies in the implementation of federal reform.
  • Legislative Action- The legislature passed SF 2356 which among other things creates an informational exchange under the Insurance Department. Several joint resolutions to opt of federal reform were considered but rejected by the legislature.
  • Department Action- Angela Burke-Boston and Anne Atca have been named to oversee the Insurance Department’s implementation activities. 


  • Governor Action- Governor Butch Otter made an appearance on the state news offering his comments on federal health reform and Idaho’s litigation against federal reform.
  • Department Action- DOI has posted information for the public concerning health care reform which includes timelines for reform and an FAQ.  The timeline includes the interim high risk pool, but there is no other information that has been published (note, the state is part of the multi-state litigation which may impact collaboration between state and feds on certain immediate reforms).
  • Legislative Action/Anti Reform-  H.B. 391 is the “Idaho Health Freedom Act”, which attempts to prohibit the imposition of an individual mandate was passed and signed.
  • Governor Action- Governor Daniels issued a release containing reform facts as it relates to Indiana and expressed his feelings of discouragement due to the passage of the bill


  • Department Action- Insurance Director McGraith has posted information highlighting near-term changes resulting from reform.
  • Risk Pool Action-  We believe the Department will contract to operate the pool.  The Department is considering lowering rates for current risk pools to 100%, down from 150% and imposing taxes/fees on carriers to fund the losses/premiums.


  • Department Action- The Department has been charged with leading the state’s implementation efforts.  Commissioner Sandy Praeger will be gathering stakeholders together on April 23 to discuss implementation issues.
  • Legislative Action/Anti-Reform- Proposals to opt out of federal reform were considered but rejected by the legislature.
  • Department Action- The Department added reform FAQ sheet to website homepage – indicated it will be continuously updated


  • Legislative Action- Senate Resolution 8, requiring a study of the effects of the federal reform legislation on Louisiana was introduced but has not yet been heard. HB 299 permits the commissioner to publicize rules as necessary to assure compliance with the federal law.  That bill was passed out of House Insurance on 4/20.


  • Governor Action- The Governor's Office of Health Policy and Finance (Trish Riley) will coordinate the administration's response and will work through the Advisory Committee of Health Systems Development which has most recently been working on payment reform.
  • Legislative/Regulatory Action- Currently no regulations have been issued, however, the legislature passed a joint order establishing a select committee to oversee implementation.  The committee, made up of 5 senators and 12 house members, are charged with studying federal health care reform legislation and determine the State's opportunities for health care reform and the State's role in implementation of federal legislation. In examining the federal reforms, the committee shall consider:
  1. The impact of federal legislation on existing state law and programs that provide access to health care to residents;
  2. The role of the State in the implementation and oversight of a health insurance exchange;
  3. The opportunity to conduct pilot projects, including, but not limited to, pilot projects related to cost containment, payment reform, use of health care technology or health care coverage, with federal funding;
  4. The impact of federal legislation on MaineCare program; and
  5. How federal legislation affects the ability to adopt a system of universal health care through a single-payer plan.


  • Governor Action- Governor O’Malley has issued an executive order creating the Maryland Health Care Reform Coordinating Council to advise the administration on policies and procedures regarding the federal legislation. Lt. Gov. Anthony G. Brown and Maryland Department of Health and Mental Hygiene Secretary John M. Colmers will co-chair the Council.
  • Risk Pool Action- We believe the Department, utilizing recently enacted legislation, will contract to operate the pool.


  • Governor Action- Governor Granholm has issued an executive order creating:
  1. A Health Insurance Reform Coordinating Council to evaluate the new law and identify steps for implementation;
  2. An  Office of Health Insurance Consumer Assistance; and
  3. A Website for consumers to learn about the bill and what it means to MI citizens.
  • Risk Pool Action- We expect the Department to contract with HHS to operate the pool and either build upon existing coverage or contract with Blue Cross of Michigan.


  • Governor Action- Governor Pawlenty has stated that he intends to either file or join a lawsuit seeking to prevent the imposition of federal reforms.
  • Litigation/Anti-Reform Action- Attorney General Lori Swanson declined the Governor’s request to join multi-state lawsuit.  She informed Governor Tim Pawlenty that she would be filing a brief in support of the federal government in the case.
  • Department Action- The Department of Commerce has placed Healthcare Reform content on its website.
  • Litigation/Anti-Reform Action- The Democratic Attorney General has declined to participate in the multi-state lawsuit challenging the federal reforms.   We believe the Governor will elect to hire counsel to participate in the litigation on behalf of his office.  A ballot initiative has been filed to amend the constitution to prohibit laws imposing an individual mandate.
  • Risk Pool Action- Governor Barbour has told the department of insurance that he does not want the state to participate in the federal risk pool, citing concerns that the program will be underfunded.  However, the department is still assessing their options.


  • Legislative/Anti-Reform Action- Measures proposing a constitutional amendment to prohibit compelling a person to participate in any health care system have passed the House and are now in the Senate.


  • Legislative Action-  The Department is working with the Legislative General Counsel who has informed the Department it will need to find authority in existing state law to set up and administer the high risk pool fund.  Additionally, the Department can spend additional federal funds without the necessity of an appropriation if the interim finance committee approved a budget amendment.
  • Risk Pool Action- The Department has only provided the contact person for the risk pool and has yet to make a determination as to whether to participate.
  • Department Action- The Nebraska Insurance Department has established an internal working group that has begun meeting regularly.
  • Litigation/Anti-Reform- Attorney General John Brunning issued a press release announcing he would challenge the bill’s constitutionality.
  • Risk Pool Action- We expected the Governor to decline contract with HHS.


  • Department Action- Commissioner Kipper has begun weekly stakeholder meetings to discuss health care reform.

New Jersey:

  • Department Action- The Insurance Commissioner published a narrative question and answer piece revealing how many of the federal reforms have existed in some form in the State for a while.  The Department of Insurance has commenced examining what modification will need to be made in the markets.
  • Risk Pool Action- While New Jersey does not have high risk pools, the Insurance Commissioner will try to make the case that the State is eligible for some of the federal subsidies dedicated to states with high risk pools, under the federal reform law.

New Mexico:

  • Legislative Action- The legislature adopted New Mexico SJM 1 calling on the Public Regulation Commission (Division of Insurance) to convene a health care reform working group to make recommendations and proposed action steps for implementation and for strategies to access federal money.  The group will hold its first non-organizational meeting on May 2.
  • Department Action- The Division has posted additional material related to healthcare reform on their website.
  • Risk Pool Action- We believe the Department, utilizing recently enacted legislation, will contract to operate the pool.

North Carolina:

  • Risk Pool Action- Currently it appears that the Department will elect to contract with HHS.  Although they have not released any of the specifics of their plan, we believe they plan on keeping this federally qualified high pool separate from their current high risk pool.

North Dakota:

  • Litigation/Anti-Reform Action- Attorney General Wayne Stenehjem joined the multi-state AG lawsuit.


  • Department Action- The Insurance Department has posted information about federal health care reform.  Also, on April 9, the Department held a “Symposium on the Patient Protection and Affordable Care Act of 2010: The Timeline for Implementation.” The Presentations are available: 
  1. Patient Protection and Affordable Care Act: Timeline for Implementation
    Insurance Commissioner Kim Holland
  2. National Health Care Reform: Yet another remedy for Oklahoma’s uninsured?
    Mike Fogarty, MSW, JD
    CEO, Oklahoma Health Care Authority
  3. Prevention and Wellness Provisions of the Patient Protection and Affordable Care Act
    (P.L. 111-148)
    Gary Raskob, PhD., Dean, OU College of Public Health
  • Risk Pool Action- The state will contract with HHS and will run a parallel High Risk Pool.


Risk Pool Action- The Department issued an RFI to carriers asking for input into whether the plans would participate in the pool- in order to prepare a response/position to HHS.


  • Department Action- The Department published website devoted to federal health care reform and issued a press release on March 24, highlighting that Oregon is ready to lead on health care reform. 
  • Oregon Health Authority Action- Oregon Health Care Authority (OHA)has issued a timeline and document that outline the work related to federal health reform.  The OHA is a new state agency created by House Bill 2009 and set to open in July 2011.  OHA is charged with designing a system to make quality health care accessible and affordable.  By July 2011, most health-related programs in the state will be joined together to form the Health Authority. The OHA will be overseen by a nine-member, citizen-led board called the Oregon Health Policy Board. Members will be appointed by the Governor and confirmed by the Senate.
  • High Risk Pool Action- Oregon Health Care Authority is moving to establish interim high risk pool as directed by H.B. 3659 (2010) which established a temporary high risk pool program contingent on federal funding.


  • Department Action- Commissioner Joel Ario has stated he wants to work with insurers on the transition to the federal law’s adjusted community rating standard in the individual and small group markets. Pennsylvania currently has no regulation of small group rating.
  • Legislative Action- Several House Republicans plan legislation to preclude state taxation on those not buying insurance, and Senate President Pro Tem is sponsoring a constitutional amendment prohibiting the state from requiring individuals to participate.
  • Litigation/Anti-Reform Action- The Commonwealth is part of the Attorney General challenge to the constitutionality of the federal act.
  • Risk Pool Action- The Department met recently with carriers on the risk pool issue.

South Dakota:

  • Litigation/Anti-Reform Action- South Dakota Attorney General Marty Jackley joined the multi-state AG lawsuit and has posted  FAQs.
  • Legislative Action- SCR 1 was enacted opposing the federal health care reform proposals.
  • High Risk Pool Action- We believe the Department is considering contracting with HHS to administer the high risk pool but is concerned about liabilities associated with it.  The Department will sponsor a conference call later this month to discuss the options.



  • Litigation/Anti-Reform Action- The state Attorney General issued a legal opinion that several pending legislative measures would be preempted by conflicting provisions in federal reform.   In the opinion, the Democratic AG said the pending measures (H.B. 3433, H.J.R. 745, and S.B. 3498), which provide that state residents are free to choose or decline any mode of securing health care services, are in direct conflict with federal law.
  • Legislation- HB 3433 and  SB 3498 have been introduced and would attempt to prohibit an individual mandate.
  • High Risk Pool Action- The Department is undertaking a cost analysis to determine whether participation in the high risk pool will save or cost the state money.


  • Department Action - The Department is currently examining the actions that must be taken by both the Department and the legislature, and will start holding stakeholder meetings in May.
  • High Risk Pool Action - Current intelligence is that the state will likely not participate in the federal risk pool because their current state high risk pool is dormant and unfunded.


  • Legislative Action- Governor McDonnell signed Health Care Freedom Act legislation which attempts to prohibit compelling the purchase health insurance.
  • Department Action- Secretary of Health and Human Resources Bill Hazel held a seminar designed to educate legislators on the status of health care reform implementation. The Office has been in discussions with Insurance Commissioner Al Gross about regulations that need action.  Commissioner Gross has agreed to identify all policy issues that will need resolution by the Governor and Legislature. Secretary Hazel identified opportunities for Virginia to participate in optional programs and grants, including:
  1. Medicaid global payments demonstration;
  2. Establishment of community health teams to support patient-centered medical homes;
  3. Funding for childhood obesity demonstration project; and
  4. Creation of healthcare workforce incentives for students seeking careers in the medical field.
  • Legislative Action- HB 294 re-authorized the Health System Task Force to continue health reform activities and discussions over the interim to develop legislation for introduction in 2011. Interim hearings will begin in April
  • Litigation/Anti-Reform Action- HB 67 prohibits state departments and agencies from implementing any part of federal health care reform unless specified reports on federal reform are provided to the Legislature regarding potential state waivers, newly created state responsibilities, estimated costs to the state and citizens, and potential consequences if the state does not comply.
  • Department Action- The Utah Department of Insurance has established a health reform website.


  • Legislative Action- The legislature is considering legislation addressing many facets of health care reform including:
  1. Charging the Health Care Reform Commission with developing at least three options for a single system of health care, including a single payer system and insurance based system that includes a public option insurance plan.
  2. Amending existing law requiring insurers (and others) to comply with HIPPA and the recent federal health care reform legislation.

Washington State:

  • Governor Action- Governor Gregoire issued press release April 1 and signed an Executive Order establishing a Health Care Cabinet to implement federal reform.  She has re-organized her staff, replacing Steve Hill (long-time Director of the WA Health Care Authority), with Doug Porter (Medicaid Administrator) to lead the Exchange and implementation efforts as the new Administrator of the HCA.  She also has published an Impact Analysis of Federal Reforms.
  • Department Action- The OIC has published a website on health reform
  • Litigation/Anti-Reform Action-  Attorney General Rob McKenna joined the litigation against implementation of health care reform and has posted an FAQ
  • High Risk Pool Action- OIC posted on their website that the Governor is evaluating options for the interim high risk pool, “but the plan likely will be operated through Washington State's Health Insurance Pool (WSHIP).”  Also,.


  • Governor Action- Governor Doyle issued an executive order creating the Office of Health Care Reform to be led by the Secretary of Health Services and the Insurance Commissioner that will ensure maximum implementation efforts.
  • Litigation/Anti-Reform Action- Governor Doyle issued a press release disapproving the AG’s request to file action to contest federal reform.
  • High Risk Pool Action- We expect the Department to contract with HHS and use the existing high risk pool to access federal funds for the new populations.


  • Governor Action- Governor Frudenthal has asked the state Medicaid agency to evaluate the changes to Medicaid and impact on the state.
  • Litigation/Anti-Reform Action- Governor Frudenthal issued a press release March 24, stating that Wyoming would not join the multi-state litigation against federal health reform, but reserved the right to change his mind.
  • High Risk Pool Action- The Insurance Commissioner is on a working committee in the Governor’s Office which is evaluating options on high risk pool (there are no indications at this time which direction they will take).