Conning Study Reveals Hidden Crisis in Health Insurance

August 22, 2002

A new study from Conning Research & Consulting, Inc. of state health insurance regulation has revealed a hidden crisis adding to the cost of health insurance and increasing the number of uninsured individuals.

Further, it indicates that the lack of a consistent health policy at a national level is moving state regulators, interveners, and public purchasers into the policy vacuum. This is creating a regulatory web that has a profound effect on consumers, providers of care, insurance organizations, their shareholders, and corporate America.

“State Regulation of Health Insurance: The Unseen Crisis” is Conning’s comprehensive examination of the various mandates and other influences that affect health insurance. It documents the effects of extra-legislative parties, such as attorneys general, public purchasers, ombudsmen and others, on health insurance regulation at the state level. “We are seeing an unprecedented increase in the reach and regulatory complexity of state efforts to manage health insurance,” Robert Booz, Conning Vice President, and principal author of the study, said. “The unintended consequence of a lack of a national health care policy appears to be a power struggle between the states and the federal government to regulate insurance. These measures are increasing the cost of insurance and limiting the number of people actually covered by mandates.”

The study cites more than 1,800 individual mandates relating to benefits, providers, and administrative policies. The study finds these measures collectively increase the cost of health insurance by estimates ranging from 15 percent to 25 percent. This is causing some employers to choose not to offer health insurance, or employees to forego buying it because of cost. Insurers are leaving states or the market in general, limiting consumer choice.

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Topics Legislation

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