Lawsuit: Officials keeping Obamacare rates secret

Health and Human Services Secretary Sylvia Burwell testifies before the Senate Appropriations Committee on Capitol Hill in Washington.
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The man who used to be in charge of implementing Obamacare has launched a lawsuit seeking to solve a big secret of its upcoming open-enrollment period: what insurers propose to charge customers in premiums next year.

The suit charges that the Department of Health and Human Services is violating the Affordable Care Act by not yet revealing those proposed rates, despite the fact that 2015 plans go on sale Nov. 15 on government-run exchanges, including the federally run HealthCare.gov.

The action was filed Tuesday in federal court in Missouri by Washington, D.C., attorney Jay Angoff, who in 2010 was head of the HHS Office of Consumer Information and Insurance Oversight—the office responsible for implementing the ACA. Angoff also served as a senior advisor to former HHS Secretary Kathleen Sebelius.

"We're not opponents of the ACA, we're supporters of the ACA," Angoff said of himself and his clients, the Consumers Council of Missouri, a public interest nonprofit group. "We're not haters of HHS, we're lovers of HHS."

"But this is tough love," he quipped about the lawsuit, which was reported earlier Wednesday by The Washington Post.

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The Consumers Council noted in the suit that, in a formal Freedom of Information Act request filed Aug. 20, it had sought information from HHS about the rates proposed by issuers in Missouri. That same request asked for the identities of the insurers, as well as their rationale for the proposed rates, and asked that the response be expedited.

While HHS acknowledged receiving the request, it has still not provided those records, despite the fact that the FOIA law mandates that a response be made within 20 working days, the suit claims.

The suit can be read here: Consumers Council of Missouri v. Department of Health and Human Services.

Santelli Exchange: Obamacare by the numbers
Santelli Exchange: Obamacare by the numbers

Angoff told CNBC on Wednesday that while the suit specifically seeks proposed rates only in Missouri—one of 38 states that will be served by HealthCare.gov this coming year—"If they release it for Missouri they'd be hard-pressed not to release it for the rest of the states."

Angoff said he doesn't know why HHS refuses to disclose the rates that people will see online beginning Nov. 15.

"In our view, the law clearly requires it," he said.

Angoff noted that the website for the Centers for Medicare and Medicaid Services, which administers Obamacare, has long said it has been making that information public. Despite those claims, he said, they don't.

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Angoff said that if the proposed rates are disclosed in advance of open-enrollment periods, "then the public and experts for the public, experts for consumer groups, will see the assumptions on which the rates are based, and will be able, in some cases, to argue convincingly that those rates are unreasonable."

That, in turn, could lead to rate reductions in some cases, and will increase competition among insurers on the Obamacare exchanges, he said.

In an Aug. 7 story, CNBC reported how HHS was keeping the proposed rates secret, along with other data related to Obamacare, such as a breakdown of how many people enrolled with each insurer on HealthCare.gov.

In April, Angoff's lawsuit noted, 56 state consumer organizations and eight consumer representatives from the National Association of Insurance Commissioners had petitioned the Centers for Medicare and Medicaid Service "to make rate filings public as required by the ACA."

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"On July 22, 2014, CMS responded to the organizations—thanking them for recognizing the importance of making public the rate filing information but refusing to fulfill the actual request or otherwise comply with their own regulation," the suit claimed.

When asked for comment on the suit, CMS spokesman Aaron Albright issued the following statement: "We are readying the rate change information. The department is committed to providing consumers accurate information so they can make informed decisions, and therefore, before the beginning of open enrollment, the agency will publish final insurance rates for all 50 states."