State gets $1 million to help control excessive health insurance premiums
Maryland is one of 45 states that will recieve $1 million in federal funding to help control excessive hikes in health insurance premiums.
The U.S. Department of Health and Human Services announced Monday it was doling out $46 million as part of federal health care reform. The money is the first round of $250 million allocated over five years to help states monitor premiums.
The states had to apply for the funds. Washington is also receiving money.
The agency said insurance companies in many states have raised premiums with little oversight. Premiums have doubled on average during the past years, outpacing wage increases and inflation, the agency said.
High premiums have priced many people out of the health insurance market.
Federal officials say that while 26 states - including Maryland - have the authority to reject increases that seem excessive, many don't have the resources to enforce it.
Under reform, states will create health care exchanges where people can shop for coverage with subsidies, a set up that is expected to drive down premium costs. Premiums are expected to fall 14 to 20 percent under reform, according to the Congressional Budget Office.
The states will use the money to upgrade technology, improve reporting standards by insurance companies, beef up the premium review process and make premium information better available to the public.
Lt. Gov. Anthony Brown said the money will help the state on strides it has already made in maintaining affordable premiums.
"This grant will help us build on our success and identify new and innovative strategies to maintain accessible, affordable and quality care for more of our neighbors," he said in a statement.
The grants are just one way that health reform will help ease the cost of premiums.
Reform will also allow HHS to review excessive premium increases and make them public. Insurers will be required to spend at least 80 percent of premium dollars on medical care services and limit spending on overhead, marketing, CEO salaries a profits.
States will also be able to exclude from the "exchanges" health plans that show a pattern of premiuem increases that are too high.
Comments
I've seen my level of employer coverage go from 80% BCBS Preferred Provider to 76% BCBS HMO since I retired in 2006 - accompanied by over a 10% increase to my part of the premium every year. I did a detailed Excel spreadsheet looking at my sources of income, probable expenses, and put in lots of variables like inflation, rate of return/interest on assets, etc. THE thing that will do me in is if health care premiums/prescriptions keep rising at 10% or better each year. The Government told SS recipients there was no inflation, thus no COLA last year, but raised their Medicare Premiums 14.4%! When I hit 65 my BCBS becomes my Medicare supplemental and precription, and I'll really be wide open to abuse!
Posted by: The_Mick | August 16, 2010 11:34 PM