Connecticut governor vetoes hearings on insurance rate hikes

Connecticut Gov. Dannel Malloy has blocked legislation that would have required the state to hold a public "symposium" before approving or rejecting a proposed health insurance rate increase.

The Legislature passed the bill on June 8, but the governor said such a requirement was unnecessary. Malloy said the bill would have been more restrictive than federal guidelines for rate review or any other state's rate regulation, potentially driving away insurers from Connecticut.

"The increased burden and uncertainty caused by these portions of [the bill] that go beyond federal standards [would] likely cause insurers to reduce the number of products they are willing to offer Connecticut residents," Malloy wrote in a message accompanying his veto.

The Patient Protection and Affordable Care Act calls for the federal government to intervene in cases where states do not have a robust rate increase review process. In its final rule published May 23, the Dept. of Health and Human Services noted that despite some calls for routine public hearings on rate hikes, it determined that mandatory hearings would not improve rate oversight.

In July, the Center for Consumer Information and Insurance Oversight, now part of the Centers for Medicare & Medicaid Services, released a list of states it considers to have inadequate rate review systems. Connecticut's law was deemed adequate. For the 10 states that HHS considers to have an ineffective system, the CCIIO will review any proposals that represent an average rate increase of 10% or more.

The Connecticut State Medical Society had supported the bill.

"At a time when there is more public interest in legislative and regulatory processes than ever before, Connecticut missed the opportunity to be the leader in public participation in insurance rate review processes and instead has taken a step backward," CSMS Executive Vice President Matthew Katz said in a written statement.