When Congress passed the ACA in 2010, it kept the existing system of private health insurance that we have today. The ACA did impose new requirements for insurance companies in order to ensure that most Americans can get and keep good coverage. But the ACA did not create a whole new world of Washington-run health care.
Florida, through the Office of Insurance Regulation (OIR), has a strong history of appropriately regulating health insurance and protecting consumers. Health insurance has always been regulated by the states, and the ACA did not change that either. The ACA did not pump resources into federal enforcement. The law kept the authority with the states, and gave states time and 100% federally funded grants to make the adjustments to their existing programs in preparation for 2014.
Nevertheless, Senate Bill 1842 blocks OIR from doing its critical work to protect consumers for at least two years, including all of the following:
1. Sidestepping the ACA, Rather Than Implementing It
The bill was described as an effort to implement the ACA’s private insurance requirements, but it does no such thing. The Legislature deliberately avoided changing state law to match ACA requirements or empower OIR to enforce ACA requirements as an integral part of its work to protect consumers. Instead, it simply removed the direct conflicts with the ACA in state law, leaving it in a separate universe.
2. Blocking Insurance Commissioner from Reviewing Proposed Rate Increases
OIR cannot reject – or even review rate increases proposed by insurance companies, no matter how unjustified or discriminatory, at least for plan years 2014 and 2015. Instead, OIR instead must turn the responsibility for review and approval of all proposed rate increases for those that are not exempt from the ACA to the federal Department of Health and Human Services (HHS). HHS not only lacks the resources to review and approve all rate increases on Florida’s behalf, it lacks some of the legal authority necessary to do so as well.
Florida has already rejected opportunities that would have provided tens of millions of dollars in entirely federally funded grants that could have increased its capacity to conduct these rate reviews. Senate Bill 1842 instead takes Florida backward, making it the first state recognized by HHS as having an “effective rate review program” to attempt to turn rate review over to the federal government.
3. Blocking the Insurance Commissioner from Protecting Consumers
OIR cannot enforce any of the essential consumer protections added by the ACA or take any direct action in response to violations of ACA requirements, no matter how seriously consumers will be harmed. All that OIR is permitted to do is notify HHS and hope they are able to take action, and OIR is not even required to do that.
The Department of Financial Services can assist consumers with insurance-related complaints, but it is not required to report them to OIR, and OIR could not take action if the complaint pertains to an ACA violation anyway.
4. Requiring Insurers to Send Deceptive and Misleading Notices to Consumers Blaming the ACA The only “public education” of any sort authorized by the Legislature related to the ACA is a requirement in Senate Bill 1842 that insurers send extremely biased and incomplete notices this fall about the ACA and its effect on policyholders’ rates. The sole purpose of the requirement is to create “sticker shock” that can be blamed on the ACA There will be no mention of the many uncertainties or any other relevant factors, such as past rate increases or how actual rates will be reduced for many by the availability of Premium Tax Credits.
5. “Bonus” Provisions: Adding State Requirements on Top of Federal Requirements for New Navigators Because the Legislature decided not to set up or otherwise address the issue of Florida’s Health Insurance Exchange (Marketplace), instead leaving it to federal HHS for now, insurance agents pushed to include unrelated restrictions on the new “Navigators” in Senate Bill 1842. Navigators will assist consumers with accessing the Exchange and are already subject to strict federal requirements and standards. They will now also be required to register with and be screened by the state, and may face stiff penalties if their non-profit employers err.
Senate Bill 1842 brings bad news for Florida consumers in at least two distinct ways: 1) it deregulates health insurance at the state level, putting consumers at risk; and 2) it sets up the ACA to be blamed for Florida’s irresponsibility