Washington State Senate Approves Bill That Would Increase Oversight Of Individual Health Insurance Policies

Main Category: Health Insurance / Medical Insurance
Article Date: 06 Feb 2008 - 7:00 PDT

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The Washington state Senate on Wednesday voted 31-18 to approve a bill (SB 5261) that would allow the Office of the Insurance Commissioner to reject "unreasonable" rate increases for individual health insurance plans, the Seattle Times reports. Under the measure, state officials' authority to review and approve annual rate increases would be extended from small-group plans to individual plans. Insurance Commissioner Mike Kreidler and others have said that a lack of oversight has enabled insurers to raise individual plan premiums more than necessary, according to the Times.

Beth Berendt, the state deputy insurance commissioner for rates, said the bill gives the state "the ability to challenge assumptions that are unreasonable." Critics of the measure say the bill would require insurers to use up to 77 cents of every premium dollar collected to pay medical claims, up from 72 cents. In addition, if an insurer does not pay out enough in medical claims, the extra premiums would be returned to the state rather than the policyholder, the Times reports. All of the state's major insurers oppose the measure, saying that it would interfere with the market and would not address rising medical costs.

The House is expected to approve the measure (Song, Seattle Times, 2/1).

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