New Illinois law improves consumer protections in health insurance

Law forces health insurance providers to disclose profit information; streamlines application process for small group and individual applicants; provides review process for dropped coverage

A new law in Illinois will establish a review process for members of health insurance plans, make insurers' profits more transparent and standardize certain applications.

The Individual Health Insurance Fairness Act was introduced to protect consumers and small businesses against unfair insurance industry practices. "This new law will ... [allow] health insurance customers an opportunity to have an independent review when they are denied a claim by their insurance company," said Illinois PIRG director Brian Imus.

Individual and small group applicants will benefit from a standardized insurance application, AARP Illinois noted. The advocacy group supported the health insurance law.

Consumers in the state will, for the first time, be granted access to insurance companies' profit and premium data, helping Illinoisans "find out how much of [their] premium dollars actually go to healthcare," in the words of State Representative Greg Harris, a Chicago Democrat.

Jay Rockefeller, the U.S. senator from West Virginia, said last year that insurers spent between 74 and 84 percent of premiums on healthcare.

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Posted: January 6, 2010

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