Who regulates health insurance companies?

Health insurance is recognized at every level of government as involving an important public interest. At the Federal level, there are a number of important statutes applicable to health care insurance. The McCarran-Ferguson Act provides that even though the insuring or provision of health care may be national in scope the regulation of insurance is left to the states. Likewise, the Health Maintenance Organization (HMO) Act provides that HMO’s or health service plans are regulated by the states. As a result of these two Federal statutes, much of the task of health insurance regulation is left to the states.

Regulatory practices vary from state to state. For instance, in California health insurers are regulated by the Department of Insurance and HMO’s and health service plans are regulated by the Department of Corporations.

In addition, the Federal Old Age, Survivors and Disability Insurance Benefits laws (Medicare) provide that the Health Care Financing Administration (HCFA) of the Federal Department of Health and Human Services oversees grievances involving Medicare recipients. Therefore, consumers with complaints about an insurance company can contact their state’s Department of Insurance.

If someone has a complaint against an HMO or health service plan, they can contact either the Department of Insurance, the Department of Corporations, or in some states, the Department of Health. If the insured or plan member is a Medicare recipient and is not satisfied with the insurer or plan action, he or she can contact the federal agency, in addition to the applicable state agency. If the consumer complaint involves medical negligence or malpractice, in addition to the foregoing, the consumer can contact the state’s medical governing board in addition to the insurance, corporations or health departments.