OHIC chief: $1M budget loss would make oversight of carriers ‘impossible’

PROVIDENCE – Left on the cutting-room floor of the R.I. House Finance Committee last week was a proposed $1 million that without could effectively gut the Office of the Health Insurance Commissioner.
Gov. Gina M. Raimondo in her fiscal 2017 budget proposed $1 million to cover a fiscal gap created by the end of a federal-funding source previously granted through the Affordable Care Act, known popularly as Obamacare. But the proposed capital failed to make it through the budgetary vetting process of the House Finance Committee. Without the funds, OHIC estimates it will have to eliminate nine existing full-time employees, reducing the regulatory office from 12 people to three people, marking a 75 percent decrease.
Dr. Kathleen C. Hittner, OHIC commissioner, told Providence Business News that such a deep cut would prevent the office from effectively regulating the health insurance industry – it’s legislatively mandated purpose.
“I absolutely guarantee we cannot fulfill any of our mandates at that [staffing] level” she said. “There will not be any state regulating of our insurance rates and that would be a very dangerous slippery slope.”
OHIC is responsible for reviewing health insurance premiums, ensuring the solvency of health insurers and protecting consumers from excessive rate hikes. It also reviews Medicare supplement plans, student health plans, non-ACA health insurance plans and dental plans. Beginning in September, OHIC will no longer receive the federal funding, and House Speaker Nicholas A. Mattiello doesn’t agree that the state should pick up the bill.
“The expectation is that either new federal grants will become available or the enhanced work being done under the current federal grant, which continues through September, would be scaled back,” said Larry Berman, spokesman for Mattiello.
Raimondo, who’s advocating for the House to restore funding, estimates OHIC saved consumers and businesses $40 million last year by cutting health insurance rates. And Hittner worries rate-review processes will not be possible with three employees, comprising the commissioner, an administrator and legal counsel.
“We’re strongly supportive of restoring funding for OHIC,” Raimondo spokeswoman Marie Aberger told PBN. “OHIC is key to longer-term health reform efforts around paying for value, not volume, and improving the patient experience of care.”
Stephen C. Boyle, president of the Cranston Chamber of Commerce and co-chair of the Health Insurance Advisory Council, says the personnel cut would be detrimental to the office.
“Not having that staff in place would make it difficult to achieve their statutory mandate at that point,” he told Providence Business News. “Just the regular overseeing of the financial stability of the carriers would be impossible with that level of staffing.”
The House will take up the budget again for a full vote Wednesday, but it’s unclear as of right now whether OHIC will receive any restored funding, and Mattiello hasn’t warmed up to the idea.
“Speaker Mattiello is concerned that it is too common for state agencies to accept federal grants and then expect the state to continue funding programs when the money runs out,” Berman said.
When asked whether the office needed all of the 12 full-time employees to effectively run the office, Hittner defended her funding request and OHIC’s staffing levels.
“We will do what we have to do, but I made it clear when I submitted this budget … it’s what I needed,” she said. “There’s a tremendous amount of work people are doing – more than one could imagine. I’ll be grateful for a compromise if there’s one out there, but to do the work that needs to be done, I need these nine full-time employees.”

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  1. The legislature is again shooting itself in the foot. The savings from OHIC’s rate review and other “affordability” programs translate into savings for companies. These profits are taxable to the State and produce more revenue than the savings from this cut. No one in the Legislature really understands how the health care system works.