Director's Message Regarding Health Insurance Premiums for 2017

As has been reported on our website and on healthcare.gov, Arizona’s rates for Obamacare-compliant health insurance for plan year 2017 are increasing significantly.  First, I want to say that I am sorry that your rates have increased so substantially.  While the Department’s role in rate review is limited, I want to acknowledge your frustration with the rising health insurance costs.  It is a difficult time for the Arizona health insurance market and the 2017 plan year will be extremely challenging.

As you are likely aware from the extensive media coverage, almost all of the insurers participating on the Arizona healthcare exchange, commonly known as the Obamacare marketplace, withdrew from the exchange or discontinued their exchange plans for next year. Neither the state nor the federal government have the authority to compel a company to sell insurance on the exchange.  As explained to the Department, the withdrawals were due to insurance companies suffering large financial losses from their participation on the exchange.  As a result, Arizona was left with only one insurance company per county that will be issuing policies that are eligible for premium subsidies on the exchange in 2017.  This means that one insurer will be absorbing all of the major medical insurance risk on exchange in each county.  Unfortunately for us, this substantial assumption of risk led to the filing of significant premium rate increases to cover that financial risk.

When a rate increase is filed with the Department of Insurance, the ADOI does not have legal authority to approve or disapprove the major medical insurance rate.  The Department’s responsibility is to review the rate filing to confirm that valid, detailed financial and actuarial information (as required by federal and state law) is provided in support of the rate increase.  In order to perform that review, the ADOI engages independent actuaries to scrutinize the rate filings in depth to confirm compliance with the laws and regulations.

Despite the magnitude of the premium increases, the independent actuaries’ detailed reviews found that the insurers had provided the required financial and actuarial information in support of the rate increases.  The ADOI carefully supervised and reviewed the actuarial work performed, and determined that the premium rate increases were in compliance with Arizona law.  Therefore, the ADOI “filed” the rates for use in Arizona.

Insurers are required to provide a written description justifying the rate increase (an actuarial memorandum) and a simple and brief narrative describing the data and assumptions that the insurer used to develop its rate increase (a consumer justification).  This information is available for your viewing at https://ratereview.healthcare.gov/

Lastly, while many individuals who purchase their coverage on the exchange receive subsidies that will cover most or all of the premium increase, roughly a quarter of those enrolled in Marketplace plans are ineligible for subsidies and will be faced with the difficult choice of paying a dramatically higher price or going without insurance and facing a stiff penalty from the federal government.  The Governor’s Office has expressed its concerns to Congress about this situation (http://www.mccain.senate.gov/public/_cache/files/556409f1-2002-4ec5-9301-54c8438df9e5/corieri-testimony-senate-homeland-security-9-15-16.pdf) and encourages you to contact your federal representatives as well with your concerns (https://www.usa.gov/elected-officials).

Priority: 
Leslie R. Hess
Insurers Offering Individual Health Insurance in Arizona

Lists insurance companies that are offering health insurance to individuals and families in Arizona in 2020.  Open enrollment starts November 1st and runs through December 15th, 2019.  Individuals can start shopping for coverage now at healthcare.gov or cuidadodesalud.gov (Spanish)

Health Insurance Telemarketers Annoy; Pose Fraud Risks

Phoenix, AZ—The Arizona Department of Insurance (ADOI) wants to make citizens aware of scams involving aggressive telemarketers attempting to sell health insurance plans and, in some cases, attempting to gain personal and financial information possibly for criminal purposes.

The ADOI has received complaints from people who received multiple phone calls, robocalls, and text messages claiming to be from the National Health Enrollment Center, the Healthcare Enrollment Center and from Healthcare.gov. Some people report that they were contacted multiple times a day, sometimes from different phone numbers, despite requests to be placed on the companies' do-not-call lists. Additionally, some people report having been asked to provide health insurance enrollment information, including such information as address, date of birth, social security number, and personal health information that, in the wrong hands, could be used in identity theft or other fraud schemes.

Arizona citizens who have received persistent phone calls or text messages from these or other callers attempting to sell them health insurance are encouraged to file a complaint with:

Federal Trade Commission (FTC)

Arizona Department of Insurance Consumer Protection Division

  • Visit https://insurance.az.gov/consumers
  • Or call the ADOI’s Consumer Protection Hotline at 602-364-2499, or 1-800-325-2548 if calling within Arizona but outside Maricopa County.

We can all take steps to avoid becoming victims of fraud.

  • Never provide someone who calls you with your bank account number, your social security number, your credit card number, or your personal health information. If you are asked to provide this information, hang up.
  • Research the insurance agent and insurance company you are considering using by finding their license information through the ADOI’s License Search webpage (https://insurance.az.gov/license-search), and use contact information in the license record to contact them. Be skeptical and do research.
  • For information about insurance available from Health Insurance Marketplace, visit the Healthcare.gov website or call Healthcare.gov directly at 1-800-318-2596. The Arizona Department of Insurance is a state agency dedicated to protecting Arizona citizens and businesses by promoting a safe, strong, innovative and competitive insurance marketplace.

The Arizona Department of Insurance is a state agency dedicated to protecting Arizona citizens and businesses by promoting a safe, strong, innovative and competitive insurance marketplace.

FY 2020 INSURER ANNUAL ASSESSMENT INVOICES ARE AVAILABLE

Click here to view invoices for annual assessments to insurance companies and service companies. Payments are due August 9, 2019

Follow the instructions on the first page of the document to locate the invoice that applies to your company.  

Please consider using the OPTins "Assessment" account to pay your assessment invoice.  

Arizona Sample Notice of Continuation Coverage (Mini-COBRA)

Pursuant to ARS § 20-2330, a health benefits plan issued or renewed after December 31, 2018, must allow an enrollee and any qualified dependent to continue coverage after a qualifying event.  The law requires a small employer (with an average of at least 1 but fewer than 20 employees) to notify an enrollee in writing of the right of the enrollee and any qualified dependents to continue coverage under the employer's health benefits plan upon an enrollee's qualifying event.  Pursuant to Subsection C of the law, the Department has prepared a sample notice of coverage continuation form and is making the sample available on its website.  A small employer that uses, properly completes, and timely issues the Department's form is presumed to satisfy notification requirements.  On January 23, 2019, the Department uploaded a new version of the form.

Notice of Proposed Rulemaking - Corporate Governance Annual Disclosure Model Regulation

In 2019, the Arizona Legislature adopted the NAIC Corporate Governance Annual Disclosure Model Act at Arizona Revised Statutes (“ARS”) by enacting the Corporate Governance Act at Title 20, Chapter 2, Article 16 (Laws 2019, 1st Reg. Sess., Ch. 180, § 1).   The Department of Insurance (“Department”) seeks to adopt the correlate Corporate Governance Annual Disclosure Model Regulation.  ARS § 20-492.02 allows the Department to adopt rules to carry out the Act upon notice and an opportunity to be heard.  The Legislature has exempted the Department from Title 41, Chapter 6 for one year after the effective date of the Act.  (Laws 2019, 1st Reg. Sess., Ch. 180, § 2.)

Regulatory Bulletin 2019-01

Use of Credits and Premium Rebates in the Health Insurance Market