Rate Review Annual Report – September 2013

This analysis of rate review activities in calendar year 2012 shows that the rate review process saved consumers approximately $1.2 billion on their premiums when compared to the amount initially requested by insurers. In the individual market, the average rate request increase dropped by 12 percent after rate review, saving consumers an estimated $311 million. In addition to the $1.2 billion saved due to rate review, consumers received an additional $500 million in medical loss ratio rebates for 2012, for a total $1.7 billion in savings in 2012. Moreover, insurers were much less likely to submit requests for rate increases of 10 percent or more in 2012 than in previous years, and it is likely that this change in issuer behavior is a result of the Affordable Care Act policy that requires requests for increases of 10 percent or more to be justified and reviewed.