Today, CCM Board Chair Jackie Hutchinson and Consumer Utility Counsel John Coffman are in Jefferson City testifying before the Public Service Commission on behalf of residential consumers in Missouri in the Spire / Laclede rate case. Jackie, as our expert witness, is advocating on behalf of a low-income program to protect some of Missouri’s most vulnerable consumers.

Our 2017 Public Annual Report is now available.

Join us in celebrating a year of consumer advocacy! This year we will be honoring the work of James Owen in the Office of Public Counsel, standing up for consumers.

 

https://moconsumers.org/register-for-our-annual-event/

Chlora Lindley-Myers
Director, Missouri Department of Insurance
Truman State Office Building, Room 530
Jefferson City, MO 65102

Director Lindley-Meyers:

Attached are the complete comments from Consumers Council of Missouri on proposed individual rate increases for 2018. We commend the Department along with the carriers for ensuring that all counties in MO have ACA coverage, leaving no Missouri consumer without any options.

Three companies will be offering insurance on the exchange in Missouri in 2018: Cigna Health and Life Insurance Company (Cigna), Healthy Alliance Life Insurance Company, aka Anthem (HAL) and Celtic Insurance Company, a subsidiary of Centene (Celtic). One of these companies, Celtic, is new to the Missouri marketplace. The other two have filed for significant increases over last year’s premiums.

Cigna’s proposed rate increases will affect approximately 84,000 Missourians and proposed increases are significant varying from 17% to 73% with an average increase of 42%. Healthy Alliance has proposed a rate increase which will impact approximately 116,000 people in Missouri. Proposed increases vary between 30% and 47%, with an average of 41.7%. Index rates show Celtic with the lowest at $354.48, Cigna with $476.44 and Healthy Alliance with the highest at $841.24.

We took great care to analyze the data submitted by each insurer as well some of the new Department of Health and Human Service’s (HHS) rules, particularly the Market Stabilization Rule (MSR) and how new regulations have been projected to impact the cost of providing coverage.

Notably neither Cigna nor HAL took into account a number of regulatory changes included in the MSR which the Department of Health and Human Services adopted in an effort to improve the risk pool and promote stability in the individual market. Specifically omitted from justifications were the following aspects of the MSR which should have contributed to a reduction in premiums:

* Guaranteed Availability of Coverage which requires each issuer to provide coverage despite past-due premiums, but allowing premiums paid for new coverage to be paid towards past-due premiums, a change applauded by many in the industry including both Anthem and Cigna.

* Shortening of Open Enrollment periods which should reduce morbidity by reducing adverse selection by those who learn they will need medical services in late December and January, a change applauded by insurers.
* Special Enrollment Periods – ensuring that people who lose health insurance during the year due to in-voluntary non-health related events have the opportunity to enroll in new coverage, changed by HHS as requested by the insurance industry to allow for event verification and adopting several new restrictions. A change supported by insurers including Anthem and Cigna and resulting in an estimated premium reduction of 1.5% by HHS.

* Levels of Coverage – allowing flexibility to metal level plans, a change applauded by the industry, specifically Anthem and Centene.

In addition to the omission of MSR changes which should result in premium reduction, we note some concerning aspects of the individual filings, notably HAL is assuming a trend of 13.3% which is three times higher than the 4.3% countrywide trend Milliman calculated for 2017 in its Milliman Medical Index. This appears to be unrealistically high and is a significant driver of the rate increase.

The Cigna filing completely redacts of the trend applied, an unnecessary redaction which undermines the public’s ability to weigh in on the filing at all. Secondly, this filing includes an implication that Cigna is a passive price-taker without any bargaining power to drive down cost of care. And lastly, includes a trend factor assumption of 12.5% for prescription drugs, whereas Milliman calculates only 8%.

In summary, the filings include several unreasonable assumptions as well as a redaction of much of the data needed to properly analyze the findings. Therefore, Consumers Council of Missouri urges the Department to exercise its authority under Mo. Rev. Stat. § 376.465.10(4) and deem both Cigna and Healthy Alliance rates unreasonable absent further justification.

We appreciate the opportunity to weigh in directly to the Missouri Department of Insurance for the first time on proposed rate increases and respectfully ask that the Department consider these comments with review of the proposed increases, which are significant and will affect many Missourian’s ability to afford health insurance.

Sincerely,

Cara Spencer, Executive Director
Consumers Council of Missouri

Consumers Council of Missouri has completed a formal review of proposed 2018 health insurance rates in the state of Missouri. This marks the first year the Missouri Department of Insurance has the authority to review rates and CCM is calling for the Department to deem each of the rates hikes “unreasonable.”

Three companies will be offering insurance on the exchange in Missouri in 2018: Cigna, Healthy Alliance (Anthem) and Celtic (Centene, new to the MO exchange). Proposed rate increases are estimated to affect hundreds of thousands of Missourians and increases vary from 17% to 73% for individual plans. This will have a significant impact on consumers ability to afford insurance throughout the state.

In summary, the filings include several unreasonable assumptions as well as a redaction of much of the data needed to properly analyze the findings. Therefore, Consumers Council of Missouri urges the Department to exercise its authority under Mo. Rev. Stat. § 376.465.10(4) and deem rates proposed by both Cigna and Healthy Alliance  unreasonable absent further justification.

CCM’s full report of Cigna’s rate filing can be downloaded here and our full report for Healthy Alliance can be downloaded here and with our letter to the Department which summarizes both may be viewed here.

Join us in commenting to the Department of insurance. Instructions for filing comments can be found here and a sample letter to the Department can be downloaded here.

Consumers Council of Missouri has completed a complete review of proposed 2018 health insurance rates in the state of Missouri.

CONSUMER FINANCIAL PROTECTION BUREAU TAKES ACTION AGAINST NATIONAL COLLEGIATE STUDENT LOAN TRUSTS, TRANSWORLD SYSTEMS FOR ILLEGAL STUDENT LOAN DEBT COLLECTION LAWSUITS

All 800,000 Loans Will Be Independently Audited, Companies Will Pay at Least $21.6 Million and Stop Suing for Invalid or Unverified Debts

 

Washington, D.C. – The Consumer Financial Protection Bureau today took action against the National Collegiate Student Loan Trusts and their debt collector, Transworld Systems, Inc., for illegal student loan debt collection lawsuits. Consumers were sued for private student loan debt that the companies couldn’t prove was owed or was too old to sue over. These lawsuits relied on the filing of false or misleading legal documents. The proposed judgment requires an independent audit of all 800,000 student loans in the National Collegiate Student Loan Trusts’ portfolio. It prohibits the National Collegiate Student Loan Trusts, and any company they hire, from attempting to collect, reporting negative credit information, or filing lawsuits on any loan the audit shows is unverified or invalid. In addition, it requires the National Collegiate Student Loan Trusts to pay at least $19.1 million, which includes initial redress to harmed consumers, relinquished funds to the Treasury, and a civil money penalty. Under a separate consent order, Transworld Systems, Inc. is ordered to pay a $2.5 million civil money penalty.

 

“The National Collegiate Student Loan Trusts and their debt collector sued consumers for student loans they couldn’t prove were owed and filed false and misleading affidavits in courts across the country,” said CFPB Director Richard Cordray. “We’re ordering them to pay at least $21.6 million, stopping them from filing illegal lawsuits, and requiring the trusts to thoroughly audit their loan portfolios to identify any other consumers who were harmed.”

 

The National Collegiate Student Loan Trusts are 15 Delaware statutory trusts that own more than 800,000 private student loans. Between 2001 and 2007, the trusts purchased and securitized the loans, and then sold notes secured by the loans to investors. The trusts have no employees but instead use service providers to interact with consumers about their loans. Transworld Systems, Inc. is a nationwide debt collector incorporated in California, with a principal place of business in Ft. Washington, Pennsylvania. Transworld Systems employees complete, sign, and notarize sworn legal documents for collections lawsuits brought on behalf of the trusts. Transworld Systems hires a national network of law firms to file and prosecute collections lawsuits on behalf of the trusts in courts across the country.

 

The complaint against the National Collegiate Student Loan Trusts and the Bureau’s consent order regarding Transworld Systems include allegations and findings that the companies violated the Dodd-Frank Wall Street Reform and Consumer Financial Protection Act by filing false affidavits and for pursuing collections lawsuits they could not have won, if contested. Specifically, the companies:

 

• Sued consumers for debts the trusts could not prove were owed: In order to sue to collect debts, the person or company filing suit must be able to prove that the consumer owed the debt and that they own the loan that is being collected. The companies participated in illegal litigation practices when suing consumers without the necessary documentation required to sue. Over 2,000 collections lawsuits were filed on behalf of the trusts in violation of consumer financial protection laws that prevent consumers from having to pay debts they do not legally owe. In these lawsuits, the trusts do not have or cannot find the documentation necessary to prove either that they own the loans or that the consumer owed the debt. In some of these cases, the document the consumer signed promising to pay back the loan is missing. Nonetheless, the trusts filed suit against consumers to collect the debts.

 

• Filed false and misleading affidavits: In many of the collections lawsuits, false and misleading affidavits were filed. To be valid, these affidavits must be signed by a witness with personal knowledge of the consumers’ account records and the debt. In numerous instances, affiants claimed personal knowledge of the student loan debt they did not have.

 

The Bureau also alleged that the National Collegiate Student Loan Trusts filed at least 486 collections lawsuits after the applicable statute of limitations on the debt collection had expired. Additionally, the complaint alleged that, in numerous instances, many of the affidavits filed were improperly notarized because they were not sworn or signed in the presence of the notary.

 

Enforcement Action

Under the Dodd-Frank Act, the Bureau has the authority to take action against institutions or individuals engaging in unfair, deceptive, or abusive acts or practices or that otherwise violate federal consumer financial laws. Under the terms of the proposed final judgment and consent order, the Bureau is requiring the companies to:

 

• Conduct a thorough audit of the 800,000 student loans in its portfolio: The proposed final judgment requires the National Collegiate Student Loan Trusts to hire an independent auditor acceptable to the Bureau to audit their student loan accounts. If the audit identifies any additional student loans for which the trusts lack the documentation needed to prove the consumer owed the debt, the National Collegiate Student Loan Trusts will cease all collections on those loans.

 

• Pay at least $3.5 million in restitution: Under the proposed final judgment, the National Collegiate Student Loan Trusts is ordered to pay at least $3.5 million in restitution to more than 2,000 harmed consumers who made payments after being sued by the trusts on a loan where documentation was missing or the statute of limitations had expired. Furthermore, under the proposed final judgment, the National Collegiate Student Loan Trusts is required to provide restitution to additional consumers identified through the independent audit. Consumers who believe they were harmed do not need to take any action at this time. If they are eligible for restitution, the company will contact them directly. Consumers who are unsatisfied with the response or have other complaints about these practices can submit a complaint with the Bureau.

 

• Stop filing collections lawsuits on debt that can no longer legally be sued over: Statutes of limitation limit the amount of time an individual or company can go after someone in court for a debt that is allegedly owed. Under the terms of the proposed final judgment and the consent order, the companies are prohibited from tying consumers up in litigation after the expiration of the applicable statute of limitations.

 

• Stop attempting to collect, reporting negative credit information, and suing consumers for debt without proper documentation: Under the terms of the proposed final judgment and the consent order, the companies are prohibited not only from suing without documentation, but also from collecting and reporting negative credit information without documentation.

 

• Stop filing false or improperly notarized legal documents: Under the terms of the proposed final judgment and the consent order, the companies are prohibited from filing false or misleading legal documents and are required to ensure all documents that require notarization are properly notarized.

 

• Pay $7.8 million in disgorgement: Under the terms of the proposed final judgment, the National Collegiate Student Loan Trusts must relinquish $7.8 million to the U.S. Treasury.

 

• Pay a $7.8 million civil money penalty: : Under the terms of the proposed final judgment, the National Collegiate Student Loan Trusts must pay $7.8 million to the Bureau’s Civil Penalty Fund.

 

• Pay a $2.5 million civil money penalty: Transworld Systems must pay $2.5 million to the Bureau’s Civil Penalty Fund under the consent order.

 

The proposed judgment against the National Collegiate Student Loan Trusts has been filed with the U.S. District Court for the District of Delaware, and it is effective only if approved by the presiding judge. The consent order is effective immediately.

 

A copy of the complaint filed in federal district court against the National Collegiate Student Loan Trusts is available at: http://files.consumerfinance.gov/f/documents/201709_cfpb_national-collegiate-student-loan-trusts_complaint.pdf

 

A copy of the proposed final judgment filed in federal district court against the National Collegiate Student Loan Trusts is available at:http://files.consumerfinance.gov/f/documents/201709_cfpb_national-collegiate-student-loan-trusts_proposed-consent-judgment.pdf

 

A copy of the consent order entered today against Transworld Systems, Inc. is available at:http://files.consumerfinance.gov/f/documents/201709_cfpb_transworld-systems_consent-order.pdf

 

 

Laclede Gas Company / MGE (Spire) has filed for a double digit rate increase that would affect both sides of Missouri. This proposal would increase annual revenues by by $58.1 million. Included is a proposal to dramatically shift costs from large industrials to residential consumers.

Consumers Council of Missouri has successfully filed for intervention and have submitted expert testimony in the case, arguing for a low-income benefit program proposal.

To provide comment to the Public Service Commission on how this will impact your household, submit your comment with us. We’ve made it easy here.

 

Or you can attend a hearing:

Sept 19, 6pm: Joplin, M

Sept 21, 12pm: Independence, MO

Sept 21, 6pm: St. Joseph, MO

Oct 2, 6pm: Arnold, MO

Oct 3, 12pm and 6pm: St. Louis, MO

Oct 5, 12pm and 6pm: St. Louis, MO

Oct 11, 6pm: Kansas City, MO

Oct 12, 12pm and 6pm: Kansas City, MO
Laclede provides natural gas service to approximately 647,200 customers in the City of St. Louis as well as the Missouri counties of St. Louis, St. Charles, Butler, Iron, Franklin, Jefferson, Madison, Crawford, St. Francois and Ste. Genevieve.

Laclede Gas Company / MGE (Spire) is asking to raise its natural gas rates throughout the state of Missouri. The combined proposal would increase their base rates by over $100 million and shift additional costs to residential consumers.

To provide comment to the Public Service Commission on how this will impact your household, attend one of the hearings, or submit your comment with us.

Proposed rates for the 2018 Missouri health insurance exchange were released on Friday by the Missouri Department of Insurance.

While the Department and our state’s carriers both deserve credit for ensuring that all counties in MO have ACA coverage, this comes at significant cost. Requested increases average between 35 and 42% according to a review by the Department and as reported here.

What makes these increases even worse is that they come with compromised transparency to the general public, allowing carriers to hide critical elements they are relying on to justify significant increases. While many states allow no redactions at all, Missouri insurance companies routinely omit reasons for increases from public documents. You can read CCM’s request and legal argument for more transparency here.

Join Consumers Council of Missouri as we weigh in on these proposed rates. By federal law, the public has 30 days to comment. Contact us if you’d like guidance on submitting comment.