Wednesday, May 7, 2008

Colorado House to Make Insurance More Expensive

Categories: Colorado

The NAIC and many states have begun to change the way the departments of insurance do business with their insurance carriers, including an expansion of states that allow insurers to file forms and rates and use them immediately. Colorado, on the other hand, is looking backward by increasing the bureaucratic processes to review health insurance rates.

The Colorado House has passed H.B.1389, a bill which will require health insurance carriers to file their rates with the department before implementing the new rates. The bill establishes unreasonable loss- ratio guidelines, requires carriers to file rates in advance of implementation, and allows the department broad discretionary authority to review those rates. Such burdensome regulations will only drive up taxes and force insurers to pay higher administrative costs -- all in the hope of lowering the cost of health insurance.

Unfortunately, Coloradans will face higher taxes, and insurers higher administrative expenses, for the state's burdensome regulation of something that is better solved by a competitive marketplace.