January 12th, 2009

Reports the Times-Tribune:

Pennsylvania Insurance Department officials contend they have limited power to regulate insurance premium increases.

Under state law, all health insurers offering individual health plans, or coverage that is not through an employer, must ask the department’s permission to raise rates.

Plus, all companies selling HMO products must seek state approval for premium increases.

But only nonprofit Blue Cross and Blue Shield plans must ask the state’s permission to raise rates for group products. For-profit firms can raise the rates without approval.

Read more of the Insurance Dept.’s explanation of their abilities at the Times-Tribune. 

After reading up on what the Insurance Dept. has to say, check out another story on the issue, also in the Times-Tribune, arguing for the need for a health insurance consumer advocate:

Pennsylvania Insurance Commissioner Joel Ario, D.D., recently reiterated support for a bill to create a state watchdog to oversee health insurers’ proposed rate hikes.

House Bill 1121, by Luzerne County state Rep. John Yudichak, D-119, would create a position like the Pennsylvania Consumer Advocate job held by Irwin “Sonny” Popowsky. He monitors proposed rate increases for electric, water, gas and telephone bills.

Dr. Ario, however, said a new insurance consumer advocate might not do as good a job protecting consumers as his Insurance Department.

“Our mission is to protect the consumer,” Dr. Ario said. “If (lawmakers) want more consumer advocacy, my first choice would be for them to give us those resources and we’ll use them better than any new office probably could.”