August 19, 2002
State Regulation of Health Insurance Increases Cost and the Number of Uninsured Reports New Conning Study
Focus on national developments in health and insurance regulation has obscured the effects of state mandates. A new study 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," said Robert H. Booz, Conning Vice President, and principal author of the study. "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 over 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% to 25%. 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. This fragmentation is diluting the administrative cost containment efforts of major insurers.
The Conning study, "State Regulation of Health Insurance: The Unseen Crisis" is available from Conning Research & Consulting, Inc. for $1,250 by calling toll free (888) 707-1177 or (860) 520-1521. A complete listing of all Conning Strategic Studies can also be found by visiting the company's website at www.conning.com.
The author is a Vice President at Conning Research & Consulting, Inc. Mr. Booz has an extensive background in health and managed care. He has been in senior management positions at several HMOs and has consulted nationally and internationally to major health insurance companies. A frequent contributor to health care publications and speaker at health conferences, Mr. Booz is also an adjunct faculty member of The Center for Healthcare and Insurance Studies at the University of Connecticut.
About Conning Research & Consulting, Inc.
Conning conducts in-depth research on the insurance industry. It is located at CityPlace II, 185 Asylum Street, Hartford, CT 06103.
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