The Health Security plan limits how fast the cost of those premiums increase. Alliance premium targets are based on the current level of health care spending in each area. They, therefore, vary substantially from alliance to alliance. The National Health Board appoints a commission to explore methods to reduce these variations over time. In each regional health alliance, health plans bid each year to provide the guaranteed benefits, and alliances negotiate with them over premium levels.
Premiums vary from plan to plan.
If the average premium across all plans exceeds the alliance's premium target, the premium, the cap prevents premiums from rising beyond the target. In that case, plans whose proposed premium increases exceed the allowed rate of growth are required to accept lower premiums. The plan must adjust its payment rates to providers or accept lower profits to make up the difference. Corporate Alliances Large employers that form corporate alliances are expected to comply with the same limits on premium increases as regional alliances. If premiums in a corporate alliance exceed the allowed rate of growth during two of any three years, the Department of Labor may require the corporation to purchase coverage through regional alliances.