Private Health Insurance: Wide Variation in State Insurance Departments' Regulatory Authority, Oversight and Resources : Statement of Leslie G. Aronovitz, Associate Director, Health Financing Issues, Human Resources Division, Before the Subcommittee on Health, Committee on Ways and Means, House of Representatives

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The Office, 1993 - Health insurance - 18 pages
 

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Page 1 - ... the standards state insurance departments follow and the extent of their regulatory responsibilities, — the budget and staff resources state insurance departments commit to regulating health insurance, and — the key activities departments perform, including monitoring solvency, reviewing rate and policy forms and responding to consumer complaints.
Page 10 - ... policies because they are often complex and difficult for consumers to understand. States ensure that policies comply with state laws, which often include provisions such as readability, required coverages, prohibited exclusions and a number of administrative requirements. States do this in several ways. For example, Texas uses a detailed checklist and reads each policy form line-by-line before it can be used. In contrast, insurance regulators in Colorado only require that the insurer certify...
Page 4 - Regulating Health Insurance Each state maintains its own legal framework for regulating insurance in which the roles and responsibilities for each insurance department may differ. Over the years, NAIC has developed about 200 model laws, regulations and guidelines designed to foster state acceptance of the legal and regulatory authorities necessary to effectively regulate insurance. However, NAIC has no authority to require states to adopt or implement its model policies. This responsibility falls...
Page 6 - States try to protect consumers through a variety of regulatory activities. Past GAO studies have raised serious questions about the effectiveness of states' efforts to monitor insurer financial solvency, and our survey of states' regulatory activities found wide variations in the practices and procedures used to approve premium rates and policies. Monitoring Insurer Financial Solvency is Principal Insurance Department Responsibility The principal responsibility of state Insurance departments is...
Page 3 - States' national health expenditures is paid for out-of-pocket by individuals or through self-insured employer health plans. The self-insured plans, regulated by ERISA, cover over half of all US workers. About 42 percent of health care is funded and regulated by the federal government through programs such as Medicare, and jointly by federal and state agencies for programs such as Medicaid. The remaining 24 percent of health care is paid for by private health insurance that is regulated by state...
Page 5 - Insurance departments devoted about 24 percent of their 1991 resources to regulating health insurance. However, estimates of individual resource commitments varied widely, ranging from 4 to 57 percent of their budgets. (Appendix I lists state insurance department budgets and the percent devoted to health Insurance regulation.) It is difficult for states to estimate the number of staff that oversee a particular type of insurance because state insurance departments are typically organized by regulatory...
Page 2 - Commissioners (NAIC) consists of the heads of the insurance departments of the 50 states, the District of Columbia, and 4 US territories. NAIC develops and adopts model laws and regulations that state insurance commissioners collectively believe are needed to regulate the insurance business.
Page 6 - ... expensive medical condition and change jobs, or work in a firm that changed insurance companies. Implementing these new reforms has increased state insurance department workloads in several areas, including preparing new regulations and ensuring compliance with new policy and rate provisions. KEY HEALTH INSURANCE REGULATORY ACTIVITIES State insurance departments...
Page 2 - Although the state insurance departments are responsible for overseeing health insurers and protecting consumers, their authority extends over only part of the market and varies widely among states. Moreover, since the passage of the Employee...

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