It’s getting to be that time of the year again, and we all dread to hear those three little words…”You’re being audited.” [cue scary Psycho knife sound]
Thankfully, it’s not consumers who have to worry this time – its our health insurers. The Department of Financial Services (DOFS) announced today that it will soon start performing random audits on New York’s health insurers to make sure that their rate filings are accurate, and to look for ways to control costs.
Basically, every year insurers send in requests for new rate hikes to the DOFS, and then submit loads of data that is supposed to justify why they need more money. The DOFS then has 60 days to review each insurer’s request and supporting documentation and make a decision. But, anyone who has been following this issue may remember that last fall the DOFS opened these rate filing docs up to the public – and they ain’t pretty (you can view them all here if you don’t believe me). You may well remember the infamous 28,000 page HealthNow rate application.
To help DOFS out, the US Department of Health and Human Services (HHS) has issued a $4.4 million grant to help strenghten the rate review process and make it work better for consumers and small buisnesses. For their part, DOFS has decided to hire an independent accounting firm to help them perform randomized audits on previously filed rate applications and their supporting materials.
This is a huge win for consumers and small businesses, and will bring greater accountability to the insurance industry, and more transparency into the rate review process. After all, if folks are being asked to pay more money each year for the same benefits, or sometimes even fewer, why shouldn’t we be 100% sure that these hikes are necessary?
- Click here to read HCFANY’s press statement, titled “Department of Financial Services to Perform Random Auditos of Health Insurer Rate Filings.”
- Click here to read news coverage from LoHud.com, titled “Insurers, HMOs will have to open financial books to state auditors.”
- To read more about the HHS grant, click here.