The Sacramento Bee -
Jul. 27: The state Department of Insurance has begun alerting customers by e-mail whenever health insurance providers submit planned rate hikes to the agency.
Insurance Commissioner Steve Poizner said the new program will help bring more transparency to escalating premiums, which have come under intense public scrutiny in recent months.
"We want as many people as possible scouring these rate filings to ensure they are mistake-free," Poizner said in a statement.
"The e-mail notification tool will expand access to these documents by informing the public of when there are new filings to peruse," he said.
Earlier this year, two of the state's largest insurers Anthem Blue Cross and Aetna rescinded proposed rate hikes because of faulty math and other mistakes.
"This is a good first step," said Anthony Wright, executive director of Health Access California. "It increases the scrutiny that these rate hikes need to get. The very first step is simply knowing what the industry is doing."
As a result of the controversy over rate hikes, Poizner announced plans earlier this year to improve transparency within the health insurance industry by posting all health insurance rate filings for the individual market on the California Department of Insurance's website.
Poizner also said he would post the rate filings of the state's largest insurers online and have an outside actuary analyze the filings.
Despite the extra scrutiny, the Department of Insurance has no legal authority to reject rate hikes unless an insurer fails to meet a state mandate requiring that at least 70 cents of every premium dollar be spent on medical benefits.
Jul. 27: The state Department of Insurance has begun alerting customers by e-mail whenever health insurance providers submit planned rate hikes to the agency.
Insurance Commissioner Steve Poizner said the new program will help bring more transparency to escalating premiums, which have come under intense public scrutiny in recent months.
"We want as many people as possible scouring these rate filings to ensure they are mistake-free," Poizner said in a statement.
"The e-mail notification tool will expand access to these documents by informing the public of when there are new filings to peruse," he said.
Earlier this year, two of the state's largest insurers Anthem Blue Cross and Aetna rescinded proposed rate hikes because of faulty math and other mistakes.
"This is a good first step," said Anthony Wright, executive director of Health Access California. "It increases the scrutiny that these rate hikes need to get. The very first step is simply knowing what the industry is doing."
As a result of the controversy over rate hikes, Poizner announced plans earlier this year to improve transparency within the health insurance industry by posting all health insurance rate filings for the individual market on the California Department of Insurance's website.
Poizner also said he would post the rate filings of the state's largest insurers online and have an outside actuary analyze the filings.
Despite the extra scrutiny, the Department of Insurance has no legal authority to reject rate hikes unless an insurer fails to meet a state mandate requiring that at least 70 cents of every premium dollar be spent on medical benefits.
This was a post on The Sacramento Bee, dated Jul. 10.
A balanced budget for Sacramento County? Not so fast. A Sacramento Superior Court judge on Thursday blocked the county's scheduled cuts to medical programs for the poor, ordering that clinics slated for closure remain open.
The cuts were set to take effect this weekend the start of the new fiscal year. Cuts to primary care, including the clinics, were projected to save $7.8 million. It was part of a spending plan the Board of Supervisors approved last month that included layoffs for nearly 700 workers. The board had to balance a $1.9 billion general fund budget.
Included in the cuts were the closure of two medical clinics and the halving of services at the one remaining clinic, which treated indigent residents who didn't qualify for other medical coverage. Two indigent residents and Sacramento's Loaves & Fishes sued the county over the cuts, which they claimed would put poor residents in danger and lead to inadequate medical care.
On Thursday, Judge Allen Sumner granted the plaintiffs a temporary restraining order in their lawsuit and ordered the county to keep the clinics open for now. "It means that the cuts aren't going to go into effect until we have a preliminary injunction hearing," said Stacey Wittorff, an attorney with the Legal Services of Northern California, which is representing the plaintiffs.
The budget called for closing the Del Paso and South City clinics. According to the lawsuit, the cuts would reduce patient visits at the Primary Care Center from 48,000 a year to 21,000. Advocates said wait times for those lucky enough to get an appointment could be more than six months.
In granting the temporary restraining order, Sumner found "the county acted arbitrarily in significantly reducing its medical services to indigent persons without addressing what standards it was using, or determining if it would continue to provide necessary medical care as required by statute."
"The court is well aware of the difficult budget decisions the county must make. However, the Legislature has required the county to provide medically necessary services for indigents – a mandatory duty," according to Thursday's ruling.
Reached by phone Thursday afternoon, interim-County Executive Steve Szalay said he hadn't heard about the court's decision and wasn't sure how it would affect the county. "We'll be looking at our options," Szalay said. County Counsel Bob Ryan said it might take weeks to schedule a hearing in the case.
Until then, the county can't make the cuts to the medically indigent programs.
This isn't the only lawsuit the county has faced over this year's budget cuts. There are three other lawsuits including lawsuits in federal and state court over cuts to mental health programs. Plaintiffs in the mental health cases also had sought temporary restraining orders to block their programs' cuts. The courts denied those requests, Ryan said.
A balanced budget for Sacramento County? Not so fast. A Sacramento Superior Court judge on Thursday blocked the county's scheduled cuts to medical programs for the poor, ordering that clinics slated for closure remain open.
The cuts were set to take effect this weekend the start of the new fiscal year. Cuts to primary care, including the clinics, were projected to save $7.8 million. It was part of a spending plan the Board of Supervisors approved last month that included layoffs for nearly 700 workers. The board had to balance a $1.9 billion general fund budget.
Included in the cuts were the closure of two medical clinics and the halving of services at the one remaining clinic, which treated indigent residents who didn't qualify for other medical coverage. Two indigent residents and Sacramento's Loaves & Fishes sued the county over the cuts, which they claimed would put poor residents in danger and lead to inadequate medical care.
On Thursday, Judge Allen Sumner granted the plaintiffs a temporary restraining order in their lawsuit and ordered the county to keep the clinics open for now. "It means that the cuts aren't going to go into effect until we have a preliminary injunction hearing," said Stacey Wittorff, an attorney with the Legal Services of Northern California, which is representing the plaintiffs.
The budget called for closing the Del Paso and South City clinics. According to the lawsuit, the cuts would reduce patient visits at the Primary Care Center from 48,000 a year to 21,000. Advocates said wait times for those lucky enough to get an appointment could be more than six months.
In granting the temporary restraining order, Sumner found "the county acted arbitrarily in significantly reducing its medical services to indigent persons without addressing what standards it was using, or determining if it would continue to provide necessary medical care as required by statute."
"The court is well aware of the difficult budget decisions the county must make. However, the Legislature has required the county to provide medically necessary services for indigents – a mandatory duty," according to Thursday's ruling.
Reached by phone Thursday afternoon, interim-County Executive Steve Szalay said he hadn't heard about the court's decision and wasn't sure how it would affect the county. "We'll be looking at our options," Szalay said. County Counsel Bob Ryan said it might take weeks to schedule a hearing in the case.
Until then, the county can't make the cuts to the medically indigent programs.
This isn't the only lawsuit the county has faced over this year's budget cuts. There are three other lawsuits including lawsuits in federal and state court over cuts to mental health programs. Plaintiffs in the mental health cases also had sought temporary restraining orders to block their programs' cuts. The courts denied those requests, Ryan said.
BestWire Services -
Jul. 19: Since the passage of U.S. health care reform, battles have erupted in some states between insurance commissioners and health insurers over double-digit premium rate increases sought by insurers on members in their individual and small group health plans.
Some fights are being waged in the battleground states of California, Massachusetts and New Mexico. The issue, in large part, has become a political hot potato, some say. With more talk at the federal level about the need for oversight of excessive rates, insurance commissioners are interested in showing that they are acting to protect consumers, said Carmen Balber, director of the Washington, D.C. office for Consumer Watchdog.
Some commissioners have raised the profile of disapprovals because "it's an easy target for them to make hay with," said J.P. Wieske, acting executive director of the Council for Affordable Health Insurance. Under the far-reaching reform law, insurers will be required to justify certain increase proposals considered "unreasonable" by state regulators and the U.S. Department of Health and Human Services, though that's still being defined.
Insurance departments are scrutinizing premium rates because consumers "have reached their breaking point," said Balber. Complaints are rolling into departments from consumers who cannot pay "the outrageous prices" insurers are charging, she said.
"There's no doubt that there's more attention being focused on the process by which rates are either approved or not approved within various jurisdictions," a consequence of the Patient Protection Act, said Oklahoma Insurance Commissioner Kim Holland.
But premiums are going up because medical care costs are going up and the law does not address these skyrocketing costs, said Holland, secretary-treasurer of the National Association of Insurance Commissioners and a member of its health and managed care committee.
"Until we get a grip on medical care costs, all of the regulation and rate evaluation in the world is not going to stop insurance premiums from going up," she said. Another factor is that the law mandates that every person buy insurance starting in 2014, said Balber. "That makes a big difference when you are talking about a product that is unaffordable so you go without...and a product that's unaffordable but now you're required to purchase."
Insurers are concerned about parts of the law that take effect this year that require guarantee issue for children and extension of coverage to age 26 without the mandate, Holland noted. The cost of compliance with the numerous regulations now and in the future will be "enormous" for many companies, Wieske said. To some degree, they're raising rates "on what they are expecting, cost wise."
Earlier this year, Anthem Blue Cross, a unit of WellPoint Inc., withdrew its request to raise premiums by up to 39% on members in its individual health plans in California after the insurance department found "substantial errors" in its rate filing. Commissioner Steve Poizner sent the company's rate filing to an outside actuary for review.
California "is exhibit A on why we need oversight over insurers," said Anthony Wright, executive director of Health Access California. Many states have some form of rate review, but many don't, including California, he said.
State regulators only have the power to disapprove rate increases given them by state law, Wright said. Some regulators "can choose to aggressively use that authority, or not," he said. Pressure is on state regulators to assert their authority over rate increases and a demand for additional accountability is occurring, Holland acknowledged. However, they are focused on their No. 1 obligation to policyholders: ensuring solvent insurers, she said.
Many state laws require individual or small group insurance rates to be approved by state insurance commissioners before they go into effect, called prior approval, said Balber. Others states are “file-and-use," where insurers file rates and they go into effect but regulators can reject them after the fact. In the individual market, 29 states and the District of Columbia use prior approval, while 11 states, including California, have file-and-use.
While laws vary from state to state with regard to how insurance is regulated, commissioners are generally afforded discretion to protect the citizens within their jurisdictions, Holland said.
In Massachusetts, in April, several insurers, including Blue Cross and Blue Shield of Massachusetts, sued the state over its rejection of most of their proposed increases in their individual and small-group health rates. The Division of Insurance declared the proposed rates excessive, and Commissioner Joseph Murphy used an emergency regulation to disapprove the filings.
The division disapproved 235 of 274 rate filings on April 1 "the first disapprovals in at least 30 years," said Jason Lefferts, a spokesman. The emergency regulations went into effect in February that created a 30-day review period, according to Lefferts. The final regulations now in effect mandate a 90-day review period and outline the information required to be in the filings.
In New Mexico, Blue Cross and Blue Shield of New Mexico last month petitioned the state Supreme Court to bar the acting insurance superintendent's suspension of a settlement that allowed it to raise premiums an average of 21.3% on members in some of its individual health plans.
Overall, Holland said filings are reviewed for their compliance with the law and concerns or compliance failures are raised with companies during the review process. Issues with rates are addressed by the company and, in some cases, a proposed rate is withdrawn or revised before it is "disapproved," she said.
Jul. 19: Since the passage of U.S. health care reform, battles have erupted in some states between insurance commissioners and health insurers over double-digit premium rate increases sought by insurers on members in their individual and small group health plans.
Some fights are being waged in the battleground states of California, Massachusetts and New Mexico. The issue, in large part, has become a political hot potato, some say. With more talk at the federal level about the need for oversight of excessive rates, insurance commissioners are interested in showing that they are acting to protect consumers, said Carmen Balber, director of the Washington, D.C. office for Consumer Watchdog.
Some commissioners have raised the profile of disapprovals because "it's an easy target for them to make hay with," said J.P. Wieske, acting executive director of the Council for Affordable Health Insurance. Under the far-reaching reform law, insurers will be required to justify certain increase proposals considered "unreasonable" by state regulators and the U.S. Department of Health and Human Services, though that's still being defined.
Insurance departments are scrutinizing premium rates because consumers "have reached their breaking point," said Balber. Complaints are rolling into departments from consumers who cannot pay "the outrageous prices" insurers are charging, she said.
"There's no doubt that there's more attention being focused on the process by which rates are either approved or not approved within various jurisdictions," a consequence of the Patient Protection Act, said Oklahoma Insurance Commissioner Kim Holland.
But premiums are going up because medical care costs are going up and the law does not address these skyrocketing costs, said Holland, secretary-treasurer of the National Association of Insurance Commissioners and a member of its health and managed care committee.
"Until we get a grip on medical care costs, all of the regulation and rate evaluation in the world is not going to stop insurance premiums from going up," she said. Another factor is that the law mandates that every person buy insurance starting in 2014, said Balber. "That makes a big difference when you are talking about a product that is unaffordable so you go without...and a product that's unaffordable but now you're required to purchase."
Insurers are concerned about parts of the law that take effect this year that require guarantee issue for children and extension of coverage to age 26 without the mandate, Holland noted. The cost of compliance with the numerous regulations now and in the future will be "enormous" for many companies, Wieske said. To some degree, they're raising rates "on what they are expecting, cost wise."
Earlier this year, Anthem Blue Cross, a unit of WellPoint Inc., withdrew its request to raise premiums by up to 39% on members in its individual health plans in California after the insurance department found "substantial errors" in its rate filing. Commissioner Steve Poizner sent the company's rate filing to an outside actuary for review.
California "is exhibit A on why we need oversight over insurers," said Anthony Wright, executive director of Health Access California. Many states have some form of rate review, but many don't, including California, he said.
State regulators only have the power to disapprove rate increases given them by state law, Wright said. Some regulators "can choose to aggressively use that authority, or not," he said. Pressure is on state regulators to assert their authority over rate increases and a demand for additional accountability is occurring, Holland acknowledged. However, they are focused on their No. 1 obligation to policyholders: ensuring solvent insurers, she said.
Many state laws require individual or small group insurance rates to be approved by state insurance commissioners before they go into effect, called prior approval, said Balber. Others states are “file-and-use," where insurers file rates and they go into effect but regulators can reject them after the fact. In the individual market, 29 states and the District of Columbia use prior approval, while 11 states, including California, have file-and-use.
While laws vary from state to state with regard to how insurance is regulated, commissioners are generally afforded discretion to protect the citizens within their jurisdictions, Holland said.
In Massachusetts, in April, several insurers, including Blue Cross and Blue Shield of Massachusetts, sued the state over its rejection of most of their proposed increases in their individual and small-group health rates. The Division of Insurance declared the proposed rates excessive, and Commissioner Joseph Murphy used an emergency regulation to disapprove the filings.
The division disapproved 235 of 274 rate filings on April 1 "the first disapprovals in at least 30 years," said Jason Lefferts, a spokesman. The emergency regulations went into effect in February that created a 30-day review period, according to Lefferts. The final regulations now in effect mandate a 90-day review period and outline the information required to be in the filings.
In New Mexico, Blue Cross and Blue Shield of New Mexico last month petitioned the state Supreme Court to bar the acting insurance superintendent's suspension of a settlement that allowed it to raise premiums an average of 21.3% on members in some of its individual health plans.
Overall, Holland said filings are reviewed for their compliance with the law and concerns or compliance failures are raised with companies during the review process. Issues with rates are addressed by the company and, in some cases, a proposed rate is withdrawn or revised before it is "disapproved," she said.
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The Sacramento Bee -
Jul. 18:State health insurance regulators are cracking down on insurance brokers who prey on elderly consumers confused by new federal health insurance rules.
On Tuesday, the Department of Managed Health Care took steps to bar a Folsom insurance agent from selling Medicare Advantage plans after she allegedly defrauded at least 12 capital-area seniors, who then incurred thousands of dollars in unexpected medical bills.
The agent, identified by state officials as Nadia King, allegedly canceled the existing Medicare coverage of her clients and enrolled them in Medicare Advantage plans run by private insurers.
King could not be reached for comment. She has until the end of the month to appeal the decision to revoke her privilege to sell Medicare Advantage products.
She is one of two dozen agents across the state getting legal scrutiny because of what officials said was deceptive marketing aimed at seniors.
Pauline Eckels, 98, of Citrus Heights was identified by the state as one of King's alleged victims. Eckels, who has been on Medicare since 1977, recalls a day sometime before Christmas when King knocked on her door.
She said they spent about a half hour talking, and that she provided personal information to King during the conversation. "I already had insurance, but she said she was going to try and help me get cheaper insurance."
Eckels said she never authorized King to cancel her current plan. But to her surprise a week later, her pharmacist said her prescription coverage was no longer in effect.
She said she doesn't remember much of what was said during her talk with King. "Put yourself in the shoes of a 98-year-old," she said, adding that "It messed me up good."
Federal health officials have reached out to states to stamp out fraud and deception in the Medicare program.
"Every time there is a change in one of our programs, it always creates an opportunity to take advantage of someone who doesn't understand the change," said David Sayen, administrator for Medicare's San Francisco regional office.
As the national debate over health care legislation intensified, state and federal officials said they began seeing a marked increase in complaints from consumers about possible scams and insurance agents seeking to persuade seniors to change their Medicare coverage.
Confusion over changes to the country's health care system "opened up a floodgate of deceptive sales practices and fraudulent products," said Cindy Ehnes, director of the Department of Managed Health Care.
"Deceptive marketing is nothing new," she said. "Because of the recent rhetoric around health insurance, the lack of detail -- it has created a real opportunity for less-than-scrupulous operators who are out there."
State officials say scores of other seniors may have fallen victim to scams and unethical marketing ploys.
People who prey on vulnerable populations do so because they know their victims are less likely to contact authorities, said Michael McClelland, the chief of enforcement for the California Department of Managed Health Care.
The financial rewards for unscrupulous agents can quickly add up. Agents who enroll new customers in a Medicare Advantage plan typically receive commissions of $350 to $500, McClelland said.
In a traditional Medicare policy, the federal government acts as an enrollee's insurance company. Under Medicare Advantage, among the most powerful programs within Medicare, the federal government pays premiums to a private insurer to administer benefits.
According to the state's complaint, King enrolled her elderly clients into Medicare Advantage plans without their consent. She allegedly made misrepresentations while marketing the plans.
Jul. 18:State health insurance regulators are cracking down on insurance brokers who prey on elderly consumers confused by new federal health insurance rules.
On Tuesday, the Department of Managed Health Care took steps to bar a Folsom insurance agent from selling Medicare Advantage plans after she allegedly defrauded at least 12 capital-area seniors, who then incurred thousands of dollars in unexpected medical bills.
The agent, identified by state officials as Nadia King, allegedly canceled the existing Medicare coverage of her clients and enrolled them in Medicare Advantage plans run by private insurers.
King could not be reached for comment. She has until the end of the month to appeal the decision to revoke her privilege to sell Medicare Advantage products.
She is one of two dozen agents across the state getting legal scrutiny because of what officials said was deceptive marketing aimed at seniors.
Pauline Eckels, 98, of Citrus Heights was identified by the state as one of King's alleged victims. Eckels, who has been on Medicare since 1977, recalls a day sometime before Christmas when King knocked on her door.
She said they spent about a half hour talking, and that she provided personal information to King during the conversation. "I already had insurance, but she said she was going to try and help me get cheaper insurance."
Eckels said she never authorized King to cancel her current plan. But to her surprise a week later, her pharmacist said her prescription coverage was no longer in effect.
She said she doesn't remember much of what was said during her talk with King. "Put yourself in the shoes of a 98-year-old," she said, adding that "It messed me up good."
Federal health officials have reached out to states to stamp out fraud and deception in the Medicare program.
"Every time there is a change in one of our programs, it always creates an opportunity to take advantage of someone who doesn't understand the change," said David Sayen, administrator for Medicare's San Francisco regional office.
As the national debate over health care legislation intensified, state and federal officials said they began seeing a marked increase in complaints from consumers about possible scams and insurance agents seeking to persuade seniors to change their Medicare coverage.
Confusion over changes to the country's health care system "opened up a floodgate of deceptive sales practices and fraudulent products," said Cindy Ehnes, director of the Department of Managed Health Care.
"Deceptive marketing is nothing new," she said. "Because of the recent rhetoric around health insurance, the lack of detail -- it has created a real opportunity for less-than-scrupulous operators who are out there."
State officials say scores of other seniors may have fallen victim to scams and unethical marketing ploys.
People who prey on vulnerable populations do so because they know their victims are less likely to contact authorities, said Michael McClelland, the chief of enforcement for the California Department of Managed Health Care.
The financial rewards for unscrupulous agents can quickly add up. Agents who enroll new customers in a Medicare Advantage plan typically receive commissions of $350 to $500, McClelland said.
In a traditional Medicare policy, the federal government acts as an enrollee's insurance company. Under Medicare Advantage, among the most powerful programs within Medicare, the federal government pays premiums to a private insurer to administer benefits.
According to the state's complaint, King enrolled her elderly clients into Medicare Advantage plans without their consent. She allegedly made misrepresentations while marketing the plans.
