Opinion Pieces

Keep eye out for insurance rebates, but beware new unregulated rates

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Florida, July 31, 2014 | comments

By U.S. Rep. Kathy Castor published in The Tampa Tribune on July 31, 2014

You and your employer should check the mailbox this summer for health insurance rebate checks. For the third year in a row, rebate checks from health insurance companies are on their way to customers. This is thanks to a provision of the Affordable Care Act that requires insurers to spend the majority of premiums — at least 80 percent — directly on medical costs rather than administrative costs, such as executive salaries, bonuses and marketing products.

In Florida, almost 1 million consumers are expected to receive $42 million in rebates — the most of any state.

Although Florida consumers will be happy to have more money in their pockets, Floridians should be wary of an anti-consumer provision adopted by the Republican-led Legislature and approved by Gov. Rick Scott that could cost them money. Unlike any other state in the country, Florida restricted our insurance commissioner from regulating health insurance rates, leaving us at the mercy of insurance companies for excessive rate hikes for 2015.

Several states have already reported insurance premiums for next year. Florida’s insurance rates should be announced soon, and Florida insurance companies say premiums may rise.

ACA opponents are likely to pounce at any increase, but the fact is Florida is the only state in the nation where the governor and Legislature stripped our insurance commissioner’s ability to stand up for consumers and turn down rate hikes.

Florida’s insurance commissioner leads the Florida Office of Insurance Regulation, and as the office’s name suggests, is responsible for regulating insurance companies to ensure fair practices and reasonable rates in the marketplace. Its mission statement is: “To ensure that insurance companies licensed to do business in Florida are financially viable, operating within the laws and regulations governing the insurance industry; and offering insurance policy products at fair and adequate rates which do not unfairly discriminate against the buying public.”

But on May 31, 2013, Gov. Scott signed a law to strip the insurance commissioner’s ability to reject rates determined too high for consumers. Furthermore, the insurance commissioner no longer even has the ability to negotiate rates with insurance companies participating in the Florida marketplace.

The governor and Legislature effectively washed their hands of protecting consumers against excessive rate hikes. Remember this when new insurance rates are announced soon.

Before the implementation of the Affordable Care Act, health insurance premiums often increased by double digits. The Affordable Care Act has slowed these types of increases. This is a win for consumers across the country, except in Florida. Here, once again, the ideology and deliberate actions of the governor and Legislature are another roadblock for working families.

At least Floridians can pocket the rebate checks.

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