The United States Government, headed by President Obama said that the exorbitant increase in insurance premiums by one of the medical insurance providers in the country is unjustified and unreasonable. The government has told the company to retract this increase or provide a valid explanation for the steep increase in rates.
This increase by Trustmark Mutual Holding Company’s subsidiary, Trustmark Life Insurance Company was revealed by the secretary of the health and human services department, Kathleen Sebelius. In her finding Ms Sebelius has mentioned that this sudden increase in the premium rates would have a great bearing on at least 10,000 families in the states of Alabama, Wyoming, Virginia, Pennsylvania and Arizona.
Harnessing the potential of one of the recently passed health care laws, Ms Sebelius, has said that it is time for the company to retract these rate increases or justify to its customers the reason for the raise. The new health care law that has been passed by the Obama administration recently was crafted with the aim of safeguarding the economic circumstances of middle class families in the country.
The spokesperson for Lake Forest, Illinois based Trustmark, Cindy Gallaher, said that they are not in agreement with the Department of Health and Human Services’ assumptions and conclusions. Talking about it further, she also said that the increase in the premiums was due to the increase in the usage of medical services and medical treatment costs. She also said that Trustmark has always worked within the stipulations by law and will continue to do so.
The new health insurance law, which got the approval of the President in the year 2010, has laid down certain standards for medical and health insurance, which was under the control of the state government for decades. One of the rules of this law stipulates that the increase in premium rates by companies should be reviewed annually. As per the regulations, if there is more than 10 percent increase in the rates for the insurance policies, the increase has to be reviewed by the federal or state officials before being rolled out to customers.
This law was used by the government in the recent past to curtail the 12 percent increase in the insurance premiums by Pennsylvania based Everence Insurance Company. The company, substantiating the increase, had told that the increase was needed to provide insurance coverage to small business units in the region.
