Fearing drastic health insurance rate hikes in the next few years, Senate Democrats set the stage on April 20 for federal regulation of rates, four weeks after President Obama passed a law aiming to cap skyrocketing health costs. The chairman of the Senate health committee, Sen. Tom Harkin (D-Iowa), said he intended to move this year on legislation that would “provide an important check on unjustified premiums.”

Sen. Diane Feinstein (D-Calif.) has introduced a bill that would give the secretary of health and human services the power to review premiums and block “any rate increase found to be unreasonable.” Under the bill, the federal government could regulate rates in states where state officials did not have “sufficient authority and capability” to do so.

Michael T. McRaith, director of the Illinois Department of Insurance, told legislators April 20, “There is a distinct possibility that less responsible companies will raise rates to price out people who are sick or might become sick between now and 2014.” McRaith said he and Illinois Gov. Pat Quinn “unequivocally support state-based insurance regulation,” because local officials comprehend local markets. McRaith endorsed Sen. Feinstein’s bill, saying it would “provide an impetus” for states to regulate premiums if they did not already do so.

Senate Bill Sets a Plan to Regulate Premiums (New York Times 4/20/10)

April 28, 2010