2017 Health Insurance Rate Requests

[MichaelB]

Quote:

Originally Posted by samclem Anyway, there was really no way to predict that pumping a lot of new (tax) money into the medical care system would cause the cost of that commodity to go up.

Healthcare spending? The last 5 years have seen the lowest yearly increases in total US healthcare spending in over 5 decades - together with the biggest increase in people getting coverage.

[explanade]

Health care is a commodity?

[GTFan]

Quote:

Originally Posted by MichaelB Healthcare spending? The last 5 years have seen the lowest yearly increases in total US healthcare spending in over 5 decades - together with the biggest increase in people getting coverage.

But the ACA insurer complaints have all centered around too many sick sign-ups, not enough healthy. Couple that with people jumping in and out of coverage with all the loopholes and it's not a good market for some of the insurers.

And then you have all the complaints about the deductibles and OOP for even Silver plans not being affordable for the lower-income crowd. It's not a good trend for either side IMO, based on what I've read.

[explanade]

How do you jump in and out?

You can only enroll from October for the following year. There are exceptions for life events but they're not that convenient.

And when you file taxes, you pay a penalty which is not insignificant now for not having coverage.

Plus most ACA plans have high deductibles so it's not like you're going to jump back in just for a couple of doctor's appointments and it will be worth your while.

[MichaelB]

Quote:

Originally Posted by GTFan But the ACA insurer complaints have all centered around too many sick sign-ups, not enough healthy. Couple that with people jumping in and out of coverage with all the loopholes and it's not a good market for some of the insurers. And then you have all the complaints about the deductibles and OOP for even Silver plans not being affordable for the lower-income crowd. It's not a good trend for either side IMO, based on what I've read.

Well, my post was about health care costs, not insurance. But still, insurers have many issues to deal with. I think the single biggest issue is the fact that the marketplace for individual insurance is separated into individual states, which insurers then are free to break down into regions or counties, offering policies only where they choose. This is far too granular and makes little financial sense, creating large pockets of poorly or underserved people.

Their profitability challenge is not with their large group policies , just the individual coverage, and it would make sense to look for ways to eliminate those artificial categorizations.

[samclem]

Quote:

Originally Posted by MichaelB Healthcare spending? The last 5 years have seen the lowest yearly increases in total US healthcare spending in over 5 decades - together with the biggest increase in people getting coverage.

The growth in US medical care costs (captured as National Health Expenditure by the CMS) had been going down for quite some time. Between 1961 and 2013, the average annual real growth had been 5.3%, but for the decade between 2003 and 2013 the real growth was just 3.2%
(source: CMS, see chart, Page 7).
In 2014, the trend had reversed. 2014 also was the first year major year of expanded coverage brought by the ACA (increased Medicaid coverage and the subsidies for private insurance). The CMS reported that the NHE growth for 2014 was 5.3%, with 1.62% overall inflation = 3.68 real increase

Quote:

The faster growth experienced in 2014 was primarily due to the major coverage expansions under the Affordable Care Act, particularly for Medicaid and private health insurance.

In 2015, the NHE increased 5.8% (according to figures from Altarum). Overall inflation was 0.1%, so real NHE growth for 2015 was 5.7%. Another increase in the rate of growth--from the previous year, from 2003-2013, and even above the 1961-2013 period.

NB: The above NHE are for the nation, not per captia, so adjustments would need to be made for that. More significantly, the above figures are all expenditures, not prices. And prices were (or were intended to be, apologies for my imprecise wording) the focus of my initial comment, and are arguably a more important metric than changes in expenditures (e.g if our spending is going up, but the prices of medical goods and services are declining, then it's possible that more ultimate good is occurring and people are getting better health care. OTOH, if prices are going up faster than expenditures, we are losing ground). In general, an increase in the amount of money chasing a set of goods will increase demand and prices--depending on the elasticity of the supply.

[MichaelB]

The after inflation cost of healtcare has risen each year since 1960. Over that period it has more than doubled in real terms.

The rate of increase has been less than 2% only 4 times - 2008, 2011-2013. My uneducated guess is it did not increase any more because there is only so much blood that can be squeezed from this rock, until those doing the squeezing find new ways to get more money.

To attribute the rise in costs in 2013 to Medicaid expansion is a reach IMO. There is not enough breakdown in the data to support that conclusion, and healthcare providers are among the least transparent in sharing cost data. Where the actual costs are incurred and how they are charged is quite disconnected, one of the reasons it is so difficult to control or contain.

[MBSC]

Quote:

Originally Posted by explanade How do you jump in and out? You can only enroll from October for the following year. There are exceptions for life events but they're not that convenient.

Getting a SEP was very easy for them. They only needed to claim to have made a permanent move. Now, you must submit documentation you moved to a location with different plan options. Some call center agents were granting SEPs when the person claimed they had a baby. They have been trained to request supporting documentation.

"CMS is taking further steps to limit access to special enrollment periods (SEPs). Insurers have been complaining that consumers are taking advantage of SEPs to avoid enrolling during open enrollment periods and to delay enrollment until they encounter medical costs, thus driving up costs for the entire risk pool.

CMS recently limited the use of SEPs, eliminating some SEPs, changing the requirements for the permanent move SEP, and tightening up definitions and procedures. SEP applicants will be asked to provide documents to evidence their eligibility for SEPs, such as birth or marriage certificates.

CMS has apparently rejected for now insurance industry requests that SEP eligibility be established prospectively by documentary evidence rather than retrospectively."

Reference: Obama Administration Acts To Stabilize Marketplaces, Implement Expatriate Coverage Legislation (Updated)

Quote:

Originally Posted by explanade And when you file taxes, you pay a penalty which is not insignificant now for not having coverage.

There are many penalty exemptions.

Quote:

Originally Posted by explanade Plus most ACA plans have high deductibles so it's not like you're going to jump back in just for a couple of doctor's appointments and it will be worth your while.

Most are lower income people jumping in to Silver Plans with Cost Sharing Reductions (CSR) and loading up on medical services in a one to two month span and staying out the remainder of the year. These plans can have $500 MOOP and $0-$10 copays.

[MBSC]

New York: Officials in NY approved an average rate increase of 16.6% for individual policies. The average requested increase was 19.3%.

Quote:

The Health Plan Association, an insurance industry trade group, said state efforts to hold back rate increases in prior years contributed to this year’s sizable hikes.

Reference: New York state health insurance rates to rise nearly 17% - NY Daily News

Mississippi: Officials in MS approved an average rate increase of 43% for Humana, which had sought a 50% increase.

Quote:

“I’ve approved this because it’s justified and if I didn’t approve it, they might have pulled out of the whole state,” Chaney said in a telephone interview with The Associated Press. Humana intends to serve 32 of Mississippi’s 82 counties in 2017, leaving 14 counties. It’s the only provider currently planning to offer policies on the federally subsidized exchange in 16 counties.

Reference: Mississippi approves rate hike for insurer

[ShokWaveRider]

Anyone heard about Florida?

[Salty]

Anyone heard anything regarding 2017 Obamacare rates in Massachusetts?


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[DougViages]

Right in line with most of the postings. Goes into effect 10/1/2016.

[MBSC]

California: Officials in CA approved a 2017 average rate increase of 13.2% for exchange plans.

Quote:

The state’s two largest insurers, Anthem Blue Cross and Blue Shield, will increase their rates even further by 17 percent and 20 percent respectively. Some regions will see even higher premium increases. The steepest rise (28.6 percent) will hit the counties of Monterey, San Benito and Santa Cruz, where limited competition has driven health care costs up even further. Northeast Los Angeles County will see an average uptick of 16.4 percent. San Francisco’s rates are expected to rise by an average of 14.8 percent.

Source: Covered California Announces Double-Digit Rate Increases | California County News

Kentucky: Officials in KY have approved the following rate increases.

Quote:

In most of the 15 cases before the department this year, the state set rates at or below the hikes requested by insurance companies. For example, Humana Health Plan Inc. requested that it be allowed to increase insurance rates for individuals in Kentucky by 33.7 percent; the DoI approved an increase of 31 percent. Aetna Health Plan Inc. wanted an increase of 7.6 percent; it got approval for 5.6 percent. However, Baptist Health Plan Inc. requested a rate increase of 26.68 percent, yet the DoI approved a hike of 27.9 percent. And CareSource Kentucky Co. sought an increase of 20.55 percent — and received one of 29.3 percent. Insurance Commissioner H. Brian Maynard told IL via email that in those cases, the department determined, based on actuarial review, that the request “would be inadequate to meet each company’s obligations to pay claims.”

Source: Insider Louisville: Closing Bell for Aug. 5 | Local News - WLKY Home

Massachusetts: Officials in MA have approved the following rate increases.

Quote:

The state also announced new rates for 2017 for individuals who sign up for health plans. Those rates are slated to rise 6.7 percent on average across 16 plans, affecting an estimated 268,000 people. Rates for Harvard Pilgrim customers will rise 15 percent, and for Neighborhood Health Plan members nearly 19 percent.

Source: https://www.bostonglobe.com/business...IdM/story.html

Vermont: Officials in VT approved a 2017 average rate increase of 7.3% for BCBS-VT, which had requested an 8.2% increase.

Quote:

The board disregarded much of the testimony from its own actuaries, which largely agreed with Blue Cross’ request to raise prices 8.2 percent.

Source: Vt. Health Insurer Wins Rate Boost

[MBSC]

Arkansas: Three insurers will adjust their rate increases to comply with requests from state officials. Arkansas Blue Cross and Blue Shield will increase rates an average of 9.7% instead of the 14.7% originally requested. QualChoice will increase an average of 13.5% instead of the original 23% and Centene will increase an average of 4% instead of the original 8.1% requested.

Source: 3 insurers cut rate-rise requests for state exchange

Maine: Officials in Maine approved the following average rate increases.

Quote:

The bureau gave the OK to a 25.5 percent increase for customers of Community Health Options, 21.1 percent for Harvard Pilgrim and 18 percent for Anthem. Most of the increases will be offset by subsidies for those who qualify for government assistance. “I do worry that the rate increases will be a hardship for people making just over the 400 percent,” said Emily Brostek, executive director of Consumers for Affordable Health Care, an Augusta-based health advocacy group. “If they were just barely able to make their payment now, they may not be able to afford it next year.” A fourth insurer, Aetna, had filed paperwork to join the Maine marketplace, but withdrew last week. Aetna will, however, offer off-marketplace individual plans in Maine in 2017.

Source: Maine Bureau of Insurance approves double-digit ACA rate increases - The Portland Press Herald / Maine Sunday Telegram

Tennessee: Officials in TN approved the following average rate increases.

Quote:

BlueCross BlueShield of Tennessee, the state's biggest health insurer, will raise individual rates by 62 percent in 2017. Their small group rates will rise by only 6.5 percent, however. Cigna got state approval to raise its individual rates for its ObamaCare plans by 46.3 percent, while Humana got the OK for a 44.3 percent jump in premiums for individual plans next year. Aetna doesn't offer marketplace plans, but its other individual health plans will see a 14.1 percent jump in premiums in 2017. Aetna's rates for small employer groups will rise only 1.6 percent. State regulators approved a 17.3 percent increase in individual rates for Freedom Life and a 33.86 percent increase in individual rates for TRH Health.

Source: Tennessee approves costly health exchange price hikes for state's biggest insurers | Times Free Press

[Chris7]

All of these increases will be okay. We don't have any inflation remember.

If our rates rise as expected, our healthcare costs just for the premiums will be at or near 10% of our gross income.

cd :O)

[GTFan]

Holy crap, 62% for BCBS in TN?? And other biggies get 40%+?? How the hell do regulators justify allowing this? Oh yeah, I remember who runs the place now - same anti-consumer regulators we have here in GA.

What an outrage.

[pb4uski]

Quote:

Originally Posted by GTFan Holy crap, 62% for BCBS in TN?? And other biggies get 40%+?? How the hell do regulators justify allowing this? Oh yeah, I remember who runs the place now - same anti-consumer regulators we have here in GA. What an outrage.

The saving grace is that if the premium increase is overbaked as you seem to think and they don't pay out 80% of what they collect in premiums in claims then they will need to provide insureds with a refund.

[samclem]

Quote:

Originally Posted by pb4uski The saving grace is that if the premium increase is overbaked as you seem to think and they don't pay out 80% of what they collect in premiums in claims then they will need to provide insureds with a refund.

An interesting setup we've created. The insurer's books need to show an 80% payout to HC providers (to avoid having to refund money to policyholders). But there's no true mechanism to hold down the cost of the care, since the (fewer and fewer remaining) insurers just get higher rates approved by regulators. After all--if they get to keep 20% of the total, then the bigger the total gets, the more money they make. Reducing healthcare costs will ultimately hurt, not help, their bottom line.
The regulators are scared of driving out the remaining insurance companies. As long as "% of premiums spent on care" is the metric, there will be no incentive to improve efficiency, or patient care.
This isn't a "market failure" (though it will surely be portrayed as one) because we don't have a true market. In a true market consumers would have enough information to decide on which insurer offers the best value (to include quality of care, wait times, etc) for the price, and insurers would have incentives reduce costs/improve value, they would have the means to affect the prices they pay, and they would be rewarded for good results. Not many of those traits evident in what we now have (or, to be fair, in what existed before the ACA).

[Henry Lili]

I'm just under 10% of income this year. Now it looks like we'll be down to just one insurer in SE PA. United Health and
Aetna both will pull out for 2017.Hmm, with no competition what would you do as CEO as the only game in town.....

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[explanade]

There will never be competitive markets for insurance, hospitals, doctors, drugs.

We see what's happening with drug prices as certain drugs get monopoly status.

Doctors and hospitals have no motive to offer transparent pricing because they have a very lucrative situation. They don't want to have to compete by price.

It's probably going to take a lot of pain and more scandals like Epipen before people make politicians pay for inaction. But a lot of congressmen not only have safe seats but they can take a lot of health care lobby money.