Senate committee approves two bills to regulate health insurance rate increases

Oregonian:

The Senate government committee today approved two bills that would give the state more control over health insurance companies and their premium rate requests for individuals and small businesses.

The committee approved by a 3-2 vote Senate Bill 717. The measure would give the state Insurance Division authority to call for a public hearing when an insurance company asks for a rate increase of 7 percent or more, which would be true of most requests in recent years. The bill says the insurer "shall have the burden of proving that the proposed rates meet" state requirements.

The committee also approved Senate Bill 719, which ends an exemption for health insurance companies from provisions of the Unlawful Trade Practices Act. The change would subject insurers to litigation if they engage in unlawful trade conduct, which would include unfair claim settlement practices.

Both bills, which are opposed by insurance companies, go next to the Joint Ways and Means Committee.

Sen. Chip Shields, D-Portland, chair of the committee, said the premise of allowing public hearings on rate increase requests is to let individuals and small businesses see how insurers justify their requests.

"These issues are too important to small businesses to happen behind closed doors," he said.

During a hearing earlier in the legislative session, health experts from other states said that even the possibility of a public hearing helped keep insurance rate increase requests lower.

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