Recent state law goals to spice up competition for medical insurance as large employers seek coverage for employees

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Gov. Gretchen Whitmer has signed laws that’s designed to raised enable large employers to bid out their worker health coverage.

The brand new law requires health insurers to offer details to large employers about their coverage’s medical and hospitalization claims, when requested. Sponsored by Sen. Dan Lauwers, R-Brockway Township, Senate Bill 447 passed each the House and Senate this month by wide margins.

The law was written so large employers could access the info needed to hunt bids from other carriers when renewing their worker health policies.

The Michigan Association of Health Plans, which represents HMOs within the state, said the measure could help improve competition in Michigan for health advantages.

Michigan last yr ranked because the second-least competitive market within the nation for health coverage in an annual American Medical Association (AMA) report on health plan market shares in 384 markets across the U.S. That was a decline of 4 positions from the prior yr.

“Michigan Association of Health Plan members are declining to cite nearly half of the bid opportunities they receive because employers today would not have enough details about their prior claims and utilization,” said Dominick Pallone, executive director for the Michigan Association of Health Plans.

“When employers shop for health care insurance, they aren’t shopping effectively because they’re not armed with the info,” Pallone said in an announcement. “If we will increase competition on this state, we will contain health care costs and improve quality of care.”

The AMA’s 2021 market share report issued last fall listed Blue Cross Blue Shield of Michigan as holding 68 percent of the Michigan market across all product categories in 2020. That’s up 1 percentage point from the 2020 AMA Competition in Health Insurance report.

Grand Rapids-based Priority Health ranked second statewide with a 10-percent market share across every kind of health policies.

The brand new law enables large employers to access data on total inpatient and outpatient expenditures, the quantity paid for pharmaceuticals, and the highest 50 drugs for which claims were most regularly paid and where expenditures were the best.

“Everyone knows insurance is a serious cost in our lives. I’m glad the Legislature and the governor were in a position to support this variation which may result in greater transparency and lower insurance costs for the people of Michigan,” Lauwers said in an announcement issued today by the governor’s office.

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