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Aug. 23, 2010
TOPEKA The Kansas Insurance Department will use a $1 million federal grant to strengthen the staff and the analytical systems that it uses to review rate increases filed by health insurance companies, according to Commissioner Sandy Praeger.
The grant was one of 46 awarded last week by the U.S. Department of Health and Human Services. The Affordable Care Act authorizes $250 million over five years to help state insurance regulars strengthen their rate review processes.
“What we’re going to do with this grant is look at our current process for reviewing rates and see what it would take to enhance that rate review from a computer technology standpoint to a staffing standpoint,” said Praeger, a Republican running for a third term as the state’s top insurance regulator.
Health and Human Services Secretary Kathleen Sebelius, a former Kansas governor and insurance commissioner, said standardizing and strengthening state rate review processes will help protect consumers prior to the establishment of health insurance purchasing exchanges in 2014.
“Between now and then, we will continue to work with states to ensure consumers are receiving value for the premium dollars and to avoid the kind of double-digit premium increases seen recently,” Sebelius said.
Congress added the rate-review grants program to the health reform bill after a highly publicized attempt by California’s Anthem Blue Cross to raise some individual rates by up to 39 percent.
In addition to funding improvements the rate-review processes and technologies used by individual states, the grant money will pay for an upgrade of a shared database at the National Association of Insurance Commissioners. Each of the states that received a grant will contribute a portion of their award to the NAIC, which is headquartered in Kansas City, Mo., to increase the amount of data it obtains from insurance companies. Praeger said the expanded NAIC database will help standardize the information used by states in reviewing rate filings.
“By working together through our national association, we’re going to be able to get a more effective system for a whole lot less money than it would have cost if each state tried to do it on their own and much less cumbersome for the companies,” Praeger said.
Praeger chairs the NAIC Health Insurance and Managed Care Committee, the panel most directly involved in helping the federal government implement the health reform law.