Health Care Blog

What Repealing the Affordable Care Act Will Cost Families, Seniors, Small Businesses, States…

This week, Republicans in the House of Representatives unveiled a bill that will repeal the Affordable Care Act and take us back to the days when insurance companies controlled the health care people could receive.  This doesn’t come as a surprise, as Republican leaders have been threatening repeal since President Obama signed the reforms into law on March 23, 2010.  But what is surprising is how carelessly they are disregarding the consequences of taking away the new freedoms, control over health care decisions, and the cost savings the law provides the American people, including 

• Unprecedented accountability and transparency in the insurance market;
• Reduced prescription drug costs for seniors; tax credits for small businesses to defray the costs of employee coverage;
• Protection against double-digit premium increases; preventive care without cost sharing; support for working class families by providing them tax credits to help pay for coverage;
• Improved quality health insurance coverage for all Americans by creating competitive new state based health insurance marketplaces called Exchanges; and
• Affordable, quality health coverage for all Americans regardless of their age and gender, or if they have a pre-existing condition.

Taking away these freedoms from the American people by repealing the law will put insurance companies back in control of health care—leaving Americans once again to worry about:

White House White Board: Health Reform & Rate Review

For the past decade, Americans have seen double-digit health insurance premium increases.  From 2000 to 2010, premiums rose 114 percent and nothing suggests that the quality of insurance coverage improved.  In many cases, insurance companies had free reign and weren’t held accountable when they attempted to raise rates on consumers. Only 26 states and the District of Columbia can reject premium increases that are excessive or unjustified, and many of these states lack the resources to use this authority to protect consumers.

That’s beginning to change.  Here’s how:

First, the Affordable Care Act gives states $250 million to enhance their rate review procedures so they can better protect consumers and stop unreasonable premium hikes from taking effect. 46 states and the District of Columbia have already received a share of these resources and they’re using the new funds to make more information about premiums available to the public and get the authority they need to oversee the insurance marketplace and protect consumers.

Second, the Affordable Care Act brings new transparency to the health insurance market by requiring insurance companies to publicly justify any unreasonable premium increases.  Under the new rules, if an insurance company proposes to raise rates by 10% or more, they must publicly disclose on their own, as well as HHS’ website the justification for the increase. The appropriate state insurance commissioner or, if a State does not have an effective rate review process, HHS, will then review the insurance company’s justification to determine whether or not the increase is justified.  In some states like, Washington and Maine, all new insurance premium rates, regardless of whether they are below 10% need to be approved by the state insurance commissioner’s office ahead of time, and will continue to be reviewed moving forward.

Shining a bright light on health insurance premium increases and conducting aggressive rate review will help control costs for American families. And we know rate review works. States like Washington and Maine have strong review laws that have been effective at protecting their residents from out-of-control premium increases.  And just recently, Connecticut regulators recently rejected a proposed 20 percent rate increase that would have impacted 48,000 consumers after their review found that such an increase was unjustified and excessive. 

Health and Human Services Secretary Kathleen Sebelius has recorded a new White House White Board video to explain just how this new rule works, and how rate review helps states review and crack down on unjustified premium hikes and protect consumers:

Stephanie Cutter is Assistant to the President for Special Projects