Department of Health and Human Services Secretary Kathleen Sebelius announced Monday the availability of $51 million in Affordable Care Act grants to help states review health insurance premiums.
The grants will be available at $250 million a year for five years, according to Sebelius.
"This is an important step in putting consumers back in control of their health care," she said. "By strengthening oversight of insurance premiums, these grants will help put affordable coverage back within the reach for Americans who have been hit hard by skyrocketing costs."
All states and the District of Columbia are eligible for this first round of rate review grants. To receive a grant, a state must submit a plan for how it will use grant funds to develop or enhance its process of reviewing and approving, disapproving, or modifying health insurance premium requests.
States with successful applications will receive a $1 million grant during the first round, Sebelius said.
Jay Angoff, director of the Office of Consumer Information and Insurance Oversight said in addition to helping states strengthen their oversight capabilities, the grants will allow states that do not currently review rates to establish a program.
"By subjecting rates to new public scrutiny, the oversight of premium increases will ultimately help ensure that consumers receive substantial value for their insurance dollars," he said.
In early May, Sebelius sent a letter to governors and state insurance commissioners urging them to review the authority they have under their state laws to determine whether they have all of the regulatory tools needed to approve health insurance rates before they take effect.
Under the Affordable Care Act, large health plans are required to spend at least 85 percent of premium money on healthcare. Smaller insurers are mandated to spend 80 percent.