Regime Change for Health Insurance Regulation: Rethinking Rate Review, Medical Loss Ratios, and Informed Competition

The recently enacted Patient Protection and Affordable Care Act aims to transform regulation of private health insurance. It would put in place a new federal regulatory regime that prescribes various mandates for covered benefits, imposes tighter restrictions on insurance premiums, sets limits on how premium dollars are spent, and exerts much greater political and bureaucratic control over health insurance.

As part of the American Enterprise Institute project, Beyond "Repeal and Replace": Ideas for Real Health Reform, insurance expert Scott E. Harrington argues that this new regulatory regime misdiagnoses the causes of health insurance problems and will worsen them. His study focuses in particular on the legislation's new requirements for rate review, minimum medical loss ratios, and rescission of insurance coverage.

The author offers a clear market-oriented alternative to the new law's agenda of top-down political controls. Harrington proposes reforms that would protect consumers and enhance the value of health insurance coverage, by promoting informed competition, individual choice, and personal responsibility. Instead of building a larger federal bureaucracy to ride herd on the states, his reforms would rely on targeted minimum standards for state regulation of health insurance that enhance existing consumer protections and promote competition among financially sound health insurers.

Click here to read the full paper as an Adobe Acrobat PDF.

Scott Harrington is an adjunct scholar at AEI.

Also Visit
AEIdeas Blog The American Magazine

What's new on AEI

AEI Election Watch 2014: What will happen and why it matters
image A nation divided by marriage
image Teaching reform
image Socialist party pushing $20 minimum wage defends $13-an-hour job listing
AEI on Facebook
Events Calendar
  • 20
    MON
  • 21
    TUE
  • 22
    WED
  • 23
    THU
  • 24
    FRI
Monday, October 20, 2014 | 2:00 p.m. – 3:30 p.m.
Warfare beneath the waves: The undersea domain in Asia

We welcome you to join us for a panel discussion of the undersea military competition occurring in Asia and what it means for the United States and its allies.

Tuesday, October 21, 2014 | 8:30 a.m. – 10:00 a.m.
AEI Election Watch 2014: What will happen and why it matters

AEI’s Election Watch is back! Please join us for two sessions of the longest-running election program in Washington, DC. 

Wednesday, October 22, 2014 | 1:00 p.m. – 2:30 p.m.
What now for the Common Core?

We welcome you to join us at AEI for a discussion of what’s next for the Common Core.

Thursday, October 23, 2014 | 10:00 a.m. – 11:00 a.m.
Brazil’s presidential election: Real challenges, real choices

Please join AEI for a discussion examining each candidate’s platform and prospects for victory and the impact that a possible shift toward free-market policies in Brazil might have on South America as a whole.

Event Registration is Closed
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.
No events scheduled this day.