Legal issues involving various types of insurance litigation sometimes arise for Pennsylvania businesses. An order issued today by the federal government may affect several small businesses in Pennsylvania.
The Health and Human Services Department demanded today that an Illinois-based health insurance company reverse its 13 percent rate increase that it reportedly levied several Pennsylvania businesses last year. In addition to lowering the rates, the government told the company that it must issue refunds to the effected policy-holders, according to a recent news report.
This specific health insurer in question covers many people who work for small businesses throughout Pennsylvania. Last fall, the department denied a similar increase from another insurance company that wanted to increase rates on Pennsylvania businesses by almost 12 percent.
The federal department has been reviewing all insurance rate increases of more than 10 percent in the commonwealth recently, to ensure that such increases are in compliance with federal health care reform. This is because Pennsylvania state officials do not currently have the authority to perform reviews, but a bill signed into law in December will take effect in March and allow the state to do this from then on.
The department has said that in this case, the 13 rate increase was unreasonable because a very low amount of the money from premiums will actually be spent on medical care and improvements, according to the news report.
Selecting and facilitating insurance carriers is an important part of business formation and management. A business and commercial law attorney can provide effective legal advice for these and other business decisions.
Source: Pittsburgh Tribune-Review, "Trustmark told to rescind rate," Alex Nixon, Jan. 13, 2012
