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Bill would require insurers to explain spikes in denials; regulator could open market exams
Summary
SB 474 would require carriers to report to the Maryland Insurance Administration when there are sharp increases in adverse decisions; the insurance commissioner could use that material to initiate market conduct exams.
ANNAPOLIS — The Senate Finance Committee considered SB 474, legislation sponsored by the committee chair that would require health insurers to report large year‑over‑year increases in adverse decisions (denials) to the Maryland Insurance Administration and allow the commissioner to use those reports as the basis for a market conduct exam.
Chair Pam Bridal told the committee that adverse decisions reported by carriers increased sharply between 2019 and 2023 and that pharmacy services accounted for the largest portion of the increase. "Between 2019 and 2023 there have been an increase of 38.6 percent in adverse decisions reported by carriers," Bridal said, adding that pharmacy denials rose about 71.6 percent.
Marie Grant, representing the Maryland Insurance Administration, voiced support and said her office is seeing the trend in the data: "Since 2019 alone, we've seen a 40% overall increase. Since 2015, if we look back that far, we have more than doubled in the number of adverse decisions." Grant said the additional reporting authority would help the regulator understand sudden spikes and decide whether market conduct exams are needed.
Advocates including Dana Kaufman told the committee enforcement tools are needed because existing appeals and grievances laws only help Connecticut and Maryland residents when carriers comply. Kaufman said appeals often overturn denials but lengthy grievance processes delay care; she cited an overturn rate of roughly 70 percent for cases that reach the regulator.
Supporters urged a favorable report; no opposition arguments were recorded in the transcript excerpt.
