Are Insurers Becoming Utilities? Controlled by the Government? Read on….

Sent From NAHU News

Judge Rules Against Massachusetts Insurers In Suit Over Rate Hikes.

The New York Times (4/13, A16, Sack) reports, "Gov. Deval L. Patrick won the first round Monday in a legal dispute with health insurers over the state’s recent rejection of rate increases requested by the companies. Ruling in a lawsuit brought by the companies, Judge Stephen E. Neel of Suffolk Superior Court in Boston said he would not block the state from denying the increases because the insurers had not exhausted their right to appeal administratively."

        According to the AP (4/13), "In his ruling…Neel denied a request from the insurers that the court allow them to go ahead with planned 2010 rate increases for plans covering small businesses. Neel said the insurers hadn’t exhausted the state’s administrative hearing process yet." Notably, the "state Division of Insurance had rejected the bulk of the proposed increases, saying the companies have not justified them, and that they exceed the medical inflation rate." But, the "insurers have argued that the state’s decision earlier this month to reject nearly all of their proposed 2010 premium increases will cause ‘destabilizing’ losses for them."

        The Christian Science Monitor (4/13, Buchanan) says that a total of "six insurance companies sued, arguing the state does not have the regulatory authority to cap premiums. They said they would lose $100 million without the premium increase, plus even more in the administrative costs of having to redesign their plans."

        Meanwhile, in a front-page article, the Boston Globe (4/13, A1, Weisman) reports, "The case has focused a national spotlight on the tug of war between regulators and a healthcare system over mounting costs for consumers and businesses," and adds that "Neel’s decision not to grant an injunction sought by the insurers means the state Division of Insurance’s rejection of 235 proposed rate hikes stands for now." In response to this ruling, Gov. Patrick "hailed Neel’s decision as a victory for small businesses and families that have been burdened by years of rising healthcare expenses." The Boston Herald (4/13, McConville) and the Boston Business Journal (4/13, Donnelly) also cover the story.