A Consumer’s Guide to the Rate Review Process

(April 2011)

Maine’s families and businesses continue to face higher health coverage costs. This is a problem around the nation. The higher cost, an aging population (seen in use of medical care and services), new technology, drugs, and procedures are reflected in the prices people and businesses pay for their health insurance. The cost of coverage is increasing for everyone, including people who purchase their own insurance in the individual health insurance market.

Although insurance regulators cannot address the underlying cost, the Maine Bureau of Insurance is required to review rates to make sure that premiums are not excessive, inadequate, or unfairly discriminatory. Under Maine law, insurance companies must receive approval from the Bureau of Insurance for rate increases and new rates for individual market policies. Regulators must ensure that consumers are being treated fairly and that a health insurance company is financially solid to pay claims.

While the review process is highly technical and is based on actuarial assumptions about future cost and projected use of medical care, the impact of rate increases on consumers is an important consideration.

When a company files a rate request with the Maine Bureau of Insurance, there is a procedure in place to make sure that Mainers get a chance to voice their opinion, that the process is open and fair, and that all necessary information is reviewed before a decision is finalized.

The Maine Bureau of Insurance encourages consumers to participate actively in the rate review process and has made available resources through its grant from the U.S. Department of Health and Human Services (HHS). This brochure is funded through a grant from HHS. Below are a few commonly asked questions to assist consumers in preparing for and participating in the rate review process.

My insurer notified me that they have requested higher rates, will there be a hearing?

Hearings are generally held on proposed increases that are large and affect a large number of Mainers. In the past, the Superintendent has held hearings for proposed Anthem and Mega Life rate requests in the individual market.

When a hearing is scheduled, public comment sessions are scheduled in different parts of the state. The sessions are in the evening (to accommodate people who work during the day and cannot take off work). The Bureau of Insurance makes every effort to ensure that all Mainers have the chance to provide feedback.

Do companies always get what they ask for?

Below is a table showing average rate increase requests and approved amounts for a company in Maine’s individual market.

Individual Rate Increase Requests
Effective Date	Average Requested	Average Approved
January 2001	23.5%	23.5%
February 2002	13.6%	12.7%
January 2003	7.1%	3.4%
March 2005	14.7%	14.5%
March 2006	19.8%	16.3%
January 2007	20.5%	16.7%
January 2008	18.6%	12.5%
July 2009	18.5%	10.9%
October 2010*	23.1%	14.1%
Pending request for effective date July 2011	9.7%	Pending

*Anthem appealed and litigation is pending before Maine courts

When I attend a public session, what can I expect?

Public comment sessions are generally held in large rooms to accommodate Mainers interested in providing information to the hearing panel. The hearing panel is seated at a table at the front of the room. Lawyers from parties to the case are usually seated in the first row. Microphones are provided to ensure that members of the hearing panel, as well as people providing comments, are heard.

If I want to say something, how does it work?

A consumer who wants to speak will be asked to come forward and sign in. Consumers will be asked if they want to provide sworn testimony or unsworn testimony. A court reporter is present at every hearing and public comment session to transcribe comments.

Consumers should be prepared to provide the following information:

ü Name, for the record

ü Your type of coverage (individual or job-based)

ü Your deductible level and monthly payments

ü Whether your insurance is single or family

What if I have questions?

The testimony during public comment sessions is transcribed by a court reporter and becomes part of the record in the hearing (similar to a court case). Before the public session starts there will be a short “101” session with Bureau staff to answer basic questions about the process.

Can I speak directly to the Superintendent or a member of the hearing panel outside of the hearing?

In order to be fair, private conversations about the hearing are not allowed. The Superintendent the hearing panel are “walled off” from discussing the hearing with members of the public, as well as the parties to the hearing.

All parties to the case must know what is being said to the other parties. The Superintendent and the hearing panel members cannot speak with one party without giving the other parties a chance to be part of the conversation. Such contacts are called ex parte communications. If there is a Bureau Advocacy Panel, Bureau staff serving on the panel are subject to the same restrictions on communication with the Superintendent and hearing panel as others participating in the rate case.

Do I have to be sworn in?

The choice is yours. If you choose to be sworn in, the testimony can be directly applied to the Superintendent’s final decision.If you are sworn in, what is said is available for use in deciding whether to approve the proposed rate. You will be considered a witness, and any party has the right to ask questions to obtain additional information.

If you choose not be sworn in, you may still speak. Unsworn comments are also valuable. They can help provide information on what Mainers are experiencing. The specifics of unsworn comments cannot legally be taken into account when a rate decision is made. One reason is that the act of swearing in a citizen gives parties to the hearing a right to question the person offering an opinion.

Can I still participate if I can’t make a public comment session?

Yes. In addition to comment sessions, there is a hearing at the Bureau of Insurance. The Superintendent accepts testimony from the public at the start of the hearing at the Bureau. Also, you can submit written comments by mail, fax, or e-mail.

What happens when the hearings are over and all information is received?

The Superintendent and the hearing panel review all of the material and reach a decision on a rate for the coming year which may be accepted or appealed by the insurer.

For more detailed information, you can read the Consumer Advocate’s Brochure available at http://www.maine.gov/pfr/insurance/.

More information on Anthem's 2011 Individual Rate Request - Filing Documents - Hearing and Public Comment Session Dates

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