ACA Title I, Section 1003 – Ensuring that consumers get value for their dollars: “Ugly” $250 million a year grants to determine “unreasonable” premium increases. This section requires the federal government with $250 million of annual grants to states to determine which health plan premiums are “unreasonable” and to remove the offending health plans from exchanges. How will government staff determine what is “unreasonable”? State insurance commissioners have historically had a very difficult time assessing appropriateness of health plan premium levels and when the process of rate review has then become highly politicized it usually has led to a significant decrease in the number of insurers and the movement of health insurance markets to monopoly and oligopoly pricing patterns. Spending up to $250 million a year on grants to the states is like throwing more money at the problem without having any semblance of a long term solution. What market sector has this approach worked in? None, that I know of. This section is “ugly” and should be eliminated and a provision for reporting of premium patterns to the federal government imbedded in another section of the Law concerning the new role of state insurance commissioners.

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