Health Insurance Rate Review
Volume 88, No. 3, Spring 2016
By John Aloysius Cogan Jr., Associate Professor of Law, University of Connecticut School of Law [PDF]

The Affordable Care Act’s health insurance rate review process has been touted by government officials and consumer advocates as an effective tool to control rising health insurance premiums. This Article argues that the current rate review process is limited in its ability to lower health insurance costs as it does not address the primary driver of rising premiums—the excessive prices paid by health insurers to healthcare providers. The efficacy of the Act’s rate review process is further diminished by two additional factors: (1) a retrospective medical loss ratio requirement that pressures insurers to lower administrative costs prior to rate review, and (2) the limited scope of the new rate review requirements. Nevertheless, this Article does not advocate abandoning health insurance rate review. Instead, this Article contends that health insurance rate review holds great potential to control healthcare costs and hold down premium increases if it is modified from its present form, created to address century-old insurance market defects, to be a more dynamic process that gives state insurance commissioners the authority to correct market failures in the healthcare industry that drive up the prices insurers pay for the healthcare services we consume.