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September 1: Good and bad news for health care

Good news: Rate review starts

Thanks to the health reform law, starting September 1 any insurance rate increases larger than 10% will be reviewed by independent experts to “ to guarantee the increase is reasonable and warranted.”

That’s the good news. The bad news is that even if the regulators determine that a rate increase is unreasonable, they can’t stop it from going through. State regulators can in some states, but in others like California, state regulators have no power to block unreasonable rate increases either.

What they can do though, is publicize the heck out of them, which is what California’s insurance commissioner has done to stop major rate increases from every major carrier. Really, in the end, the usefulness of the rate review rule depends on how aggressive a state’s insurance commissioner wants to be. But for those states where the insurance commissioner is fighting for consumers, the federal rate review is a valuable tool.

Bad news: COBRA subsidies ended

Also on September 1, subsidies for COBRA, a program that helps laid off workers continue their health care coverage ended. Unemployed workers will still be able to continue insurance by paying for it on their own, but as Kaiser News reports, this option can be extremely expensive:

It’s a dilemma that Holly Jespersen knows first-hand. She lost her job twice in the past two years — both times losing her employer-paid health insurance. But the second time, she paid about $350 a month more for insurance because she didn’t qualify for the subsidy. “It made a huge difference for me,” said Jespersen, 36, of Darien, Conn. “I wish I still had it.” […]

Anthony Wright, executive director of Health Access California, a consumer group based in Sacramento, Calif., said the end of the COBRA subsidy means some families will lose coverage and join the ranks of the uninsured.

“The best-case scenario is that families who are already struggling and between jobs will have to pay more to stay insured, leaving less money for the other necessities of life,” he said.

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