Effects of Implementing State Insurance Market Reform, 2011-2012. Approval Rates of State Regulators


Many filings in prior approval states record both the carrier’s initial proposed rate increase and the increase ultimately enacted. In most cases proposed rate increases were approved without modification by the state’s regulatory agency. For the purposes of these analyses, rate increases from filings submitted in states with “prior approval” or “other” regulatory authority (see Table 1) that were approved with or without modification are considered “approved.” Those that were denied or withdrawn by the carrier are not. Filings from “file and use” states are excluded from these analyses (Tables 24 to 30). Although some filings from “file and use” states may be reviewed retrospectively, the state’s decision to approve or disapprove the filing increase is not always consistently captured.

In the individual market, the approval rate increased significantly from 77.0 percent in 2011 to 84.1 percent in 2012, as shown in Table 24 below. We did not observe a higher percentage of disapprovals after implementation of the ACA rate review than in the pre- review period. Conversely, small group approval ratings decreased from 79.7 percent in 2011 to 75.9 percent in 2012, although this decrease was not statistically significant and both rates were similar to pre-review years.

Table 24: Percentage of Premium Increases Approved, by Year and Market

Carrier Size Trends 2008 Trends 2009 Trends 2010 Trends 2011† SMR 2011 SMR 2012
Individual/Conversion 76.9% 79.3%* 83.1%* 74.8% 77.0% 84.1%*
Small Group 84.4%* 64.0% 68.6% 69.7% 79.7% 75.9%

† Trends data for 2011 are incomplete (see Methods section).
* Estimate is significantly different from 2011 at p < .05.
Note: Percentage is calculated as the percentage of filings with an “approved” status among the filings for which the regulatory disposition was known. Filings from “file and use” states are not included in the analysis.

One caution that applies to both markets is that state procedures for archiving disapproved or withdrawn filings are inconsistent. In some states, files on proposed rate increases that are rejected by the regulator are kept open until a compromise rate increase can be arrived at; in others, the carrier appears to re-file at a later date under a separate tracking number. Furthermore, it is unclear whether disapproved or withdrawn filings were made available on publicly-accessible web portals to the same extent as approved rate increases.

View full report


"20130607InsMktReformReportFnl.pdf" (pdf, 1.46Mb)

Note: Documents in PDF format require the Adobe Acrobat Reader®. If you experience problems with PDF documents, please download the latest version of the Reader®