The Connecticut Citizens Action Group demonstrated against proposed insurance rate hikes in front of the Legislative Office Building on August 21, 2023. Shahrzad Rasekh / CT Mirror

As state insurance regulators consider whether to approve double-digit rate hikes for 2024 health plans, Senate Democratic leaders are pledging to introduce a bill in the upcoming legislative session that would overhaul Connecticut’s rate review process and require state officials to think about consumer affordability when weighing future increases.

Senate President Pro Tem Martin Looney, D-New Haven, and Sen. Jorge Cabrera, D-Hamden, a co-chair of the Insurance and Real Estate Committee, said they would introduce legislation to redesign the process so that more thorough documentation is required and more extensive questioning is permitted at an annual hearing on proposed rate increases.

Currently, representatives of the state’s insurance department, lawmakers, the attorney general and the health care advocate can ask questions of insurers, but several said they are not getting clear answers that address why the carriers are seeking the rate hikes.

At the most recent hearing, held last week, Assistant Attorney General Thomas Ryan asked insurers whether they conduct line-item analyses with hospitals of their charges for services.

Leaders of some insurance companies sidestepped the question or said they were not prepared to give a detailed answer. Mark Meador, president of ConnectiCare, said he was “not sure.”

“I know that our folks who are negotiating these contracts, they do use the benchmarks. We do use all the tools we can. We try and find all the data we can about a hospital and their prices before we go into the negotiations,” he said. “But sometimes we can’t get data that we might like.”

“That’s an alarming admission,” Looney said in an interview, referring to Meador’s response. “It seems that that’s a superficial way to go about determining what your rate application will be, if you’re not rigorous about understanding everything about the claims that are being made for reimbursement by the hospitals.”

Carriers have asked for an average increase of 12.4% on individual health plans and 14.8% on small group policies on and off Connecticut’s health insurance exchange next year. The filings collectively cover about 188,000 people.

This is the second year insurers have sought substantial rate hikes. Last year, they requested an average increase of 20.4% on individual plans and 14.8% on small group policies. The insurance department ultimately approved 12.9% for individual plans and 7.9% for small group.

Part of the overhaul proposed by Looney and Cabrera involves holding a hearing under Uniform Administrative Procedures Act rules, similar to hearings organized by Connecticut’s Public Utilities Regulatory Authority. That would allow state officials to collect evidence and more extensively question insurers about their recommended increases. As part of the proposed changes, officials would also be able to cross-examine witnesses and present their own evidence in a public setting.

Participants would also have to produce more extensive documentation to back up their rate hike requests. Attorney General William Tong has also called for a hearing under the UAPA law.

“It concerns me how insurance companies are arriving at their proposed rate increases,” Cabrera said. “I’m not getting a lot of details from them. We need to be able to do a deeper dive.” 

Last week, during a press conference held midway through the rate review hearing, Cabrera said he was discouraged by the insurers’ responses.

“What I proceeded to hear for almost four hours now was basically non-answers,” he said. “Just no justification at all. No real transparency, speaking oftentimes in ways that left me scratching my head. The attorney general and I were joking on the way out that I just felt like I was being punked.”

The senators also said consumer affordability, which is currently not considered during the rate review process, should be a factor in whether rate hikes are approved. Under the current policy, rates cannot be excessive, they must be non-discriminatory and they must be adequate so insurers can remain solvent.

At least one state, Rhode Island, includes affordability in its annual rate review.

“It’s something that really is essential,” Looney said.

In a letter to Connecticut Insurance Commissioner Andrew Mais, Looney and Cabrera added: “There should be a presumption of denial for any rate increase that is higher than current inflation.”

Susan Halpin, executive director of the Connecticut Association of Health Plans, which lobbies on behalf of insurers, said lawmakers’ efforts should instead be focused on reducing the cost of health care.

“The Department of Insurance requires a voluminous amount of carrier data to be submitted for analysis and review,” she said. “As the regulatory body, the department has the actuarial expertise and statutory authority to assure that final rates are appropriate. Future legislative action is better focused on how stakeholders throughout the state can work collectively to reduce the overall cost of health care itself and thereby drive more affordability of premiums.”

The state insurance department made the latest rate requests public in June. A decision on whether to approve them is expected in early September.

The next legislative session begins in February.

Jenna is CT Mirror’s Health Reporter, focusing on health access, affordability, quality, equity and disparities, social determinants of health, health system planning, infrastructure, processes, information systems, and other health policy. Before joining CT Mirror Jenna was a reporter at The Hartford Courant for 10 years, where she consistently won statewide and regional awards. Jenna has a Master of Science degree in Interactive Media from Quinnipiac University and a Bachelor or Arts degree in Journalism from Grand Valley State University.