Report: Health Insurance Rate Watch Project

Accountability in Action: Rate Review Cuts Over $24 Million in Waste from 2015 Health Insurance Premiums

Released by: OSPIRG Foundation

Close scrutiny of proposed health insurance premiums for 2015 has cut over $24 million in waste and unjustified costs from premiums for Oregon consumers and small businesses. This brings the total waste cut by Oregon’s rate review program to over $179 million since 2010.

This year, Oregon initiated a new effort to examine the drivers of health care costs as part of the rate review process, an important step forward as the state works to contain unsustainable health care cost growth. While $24 million in waste cut represents progress for Oregon consumers, it is also clear that more work needs to be done. Studies continue to show that a third or more of all health care spending is spent in ways that do not improve health.

Oregon’s health insurance rate review program, administered by the Oregon Insurance Division (OID), serves as a critical backstop to protect Oregon individuals, families and small businesses from paying unreasonable premium rates. Insurers offering coverage in the individual and small group markets must justify proposed premium rates in writing, showing that they are not excessive and explaining how the insurer is working to reduce costs. These written justifications are made publicly available on the OID’s website,, and the public has opportunities for input through public comments and hearings.

With the federal Affordable Care Act (ACA) bringing important new consumer protections into effect this year, many Oregonians have been able to access coverage for the first time, and health insurance benefits and out-of-pocket costs have improved coverage substantially for many people. At the same time, tens of thousands of Oregonians remain enrolled in older health plans without the ACA’s protections that have been extended into next year.

Oregon’s insurers filed their proposed rates for 2015 on June 2. The proposals ranged from large increases to large decreases, many of which were eventually cut back or altered by state regulators.

OSPIRG Foundation contributed to the process of reviewing these rate proposals by conducting independent in-depth research into the insurers’ filings, focusing especially on proposals from four of Oregon’s largest insurers. Moda, PacificSource, and Health Net together proposed increases ranging up to 24% on over 100,000 Oregonians purchasing insurance on their own, while United proposed double-digit increases on over 1,300 small businesses across the state.

Our analysis highlighted some areas of concern for consumers in the insurers’ justifications for their proposed rates—some unique to those insurers, others true almost across the board. We brought our concerns to the attention of the OID and encouraged the public to participate in the rate review process by submitting public comments; over 4,000 written comments were ultimately submitted.

In August, the OID began to hand down its decisions about 2015 premium rates, and agreed with many of the concerns raised by OSPIRG Foundation, cutting an estimated $24 million in waste and unjustified costs from premiums.

(For a detailed breakdown of the rate decisions and OSPIRG Foundation's recommendations for next steps, download the report--see above.)

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