Insurance companies that sell policies inside and outside of Connecticut’s Affordable Care Act traded advocates in July when they asked for an average increase of 20.4% in individual health plans next year.
The proposed rate increases, released by the state insurance department last month, also include a recommended 14.8% increase in small group health plans.
The requests are significantly higher than what insurers requested last year for health policies in 2022. Carriers in 2021 requested an average increase of 8.6% for individual plans and 12.9% for small group plans.
“It’s jaw-dropping,” Lynne Ide, program director for communications and engagement at the Universal Health Care Foundation of Connecticut. said last month. “Looking at these fee requests, the range is off the charts.
“Our big concern at the moment is, along with inflation and the fallout from COVID, these proposals increase witchcraft problems. Our concern is that people will see this and decide to go without health coverage because they just can’t afford it.”
The insurance sector is weighing the requests and is expected to make a decision in September. Before that happens, the public will have a chance to comment on the suggested rate increase.
The insurance department has scheduled a public hearing for Aug. 15, starting at 9 a.m. at the Legislative Office Building (300 Capital Ave. in Hartford).
The public can testify in person or virtually. Registration for personal testimony opens at 8:30 a.m. in the Legislative Office Building on the day of the hearing.
The deadline to sign up for virtual testimony is today (August 12). Anyone wishing to testify virtually can register by emailing cid.RateFilings@ct.gov with their name and written comments by noon.
Insurance company representatives will be given time to explain their requests for rate increases, and officials from the insurance department may ask questions. The session will be broadcast on CT-N.
Here’s what you need to know about proposals.
What do insurance companies look for?
Three insurers they are selling policies in the Connecticut exchange: Anthem Health Plans, CTCare Benefits Inc. and ConnectiCare Insurance Company Inc.
Anthem claimed an average increase of 8.6% for individual policies covering 27,698 people. The proposed changes range from a 1.8% decrease to a 16.1% increase, depending on the plan.
The company also claimed an average increase of 3.6% in small group policies covering 19,271 residents. The suggested changes range from a decrease of 1.2% to an increase of 26.3%.
CTCare Benefits claimed an average increase of 24.1% in individual plans covering 75,003 people. The proposed changes range from an increase of 18.7% to 33.2%, depending on the policy.
It also asked for an average increase of 22.9% in small group plans covering 3,476 residents (increases range from 20% to 28.9%).
ConnectiCare, which sells only individual policies on the exchange, asked for an average increase of 25.2% for plans covering 8,782 people. The suggested increases range from 17.1% to 32.2%.
A full list of on- and off-exchange plans can be found, along with requests for rate increases here.
Why do insurers charge higher rates?
Kimberly Kann, a spokeswoman for ConnectiCare, said medical and pharmaceutical costs were two of the factors driving the company’s asking rate increase.
“Our proposed fees are based on several factors, including medical and pharmacy cost trends, along with the ongoing impacts of COVID-19 on our members’ use of services, including receipt of delayed care,” she said.
“Additionally, the legislative and regulatory environments continue to present market challenges beyond the company’s control, including the loss of enhanced Premium Tax Credits provided through the American Savings Plan Act that will expire in 2022, and mandated benefits from the state.”
Alessandra Simkin, a spokeswoman for Anthem, said: “Our submission reflects our experience and ability to deliver on behalf of consumers in this market, and we look forward to working with the state as we continue the regulatory process.”
Insurers will send representatives from their companies to a public hearing in August, where they will be questioned about the proposed increase in detail.
What happens next?
Actuaries with the insurance department will review the requested increases. As part of the review, they will look at trends in unit cost (total costs incurred by the company), service utilization and expected severity of claims. The Department will ask questions of insurers and seek clarification if necessary. It will also hold a public hearing to get input from carriers, health care advocates and the public.
After review, the department may approve the full requested increase, deny it, or change it to a different number. The final changes are expected to be published in late August or early September.
Are proposed rate increases always approved?
No. Last year, for example, the state insurance department approved an average rate increase of 5.6% for individual health plans 2022, even though operators had requested 8.6%.
The department authorized an average rate increase of 6.7% for small group policies, even though insurers had requested 12.9%.
In 2020, the Anthem of Health Plans he had asked for an average increase of 9.9% in its individual plans, which served 22,071 people through the exchange. Department of Insurance ADOPTED an increase of 1.9%.
In the same year, ConnectiCare Benefits Inc. asked for an average increase of 5.5% in its individual plans on the exchange, which at the time covered 75,174 customers. Department of Insurance signed with a decrease of 0.1%.
How has the reaction been?
Health care advocates have criticized the proposed increases, saying they fear more people will go without coverage because prices are too high.
“My jaw hit the floor, of course,” said Ted Doolittle, the state’s health care attorney. “I am deeply concerned that people will go without coverage because of these high prices. It is the duty of insurance companies and providers to explain to people in the state why this is inevitable and there is no alternative.”
Ide, of the Universal Health Care Foundation of Connecticut, said the proposed increases “seem to make no sense.”
“Why would one carrier ask for an average of 8.6% in the individual market and 3.6% in the small group market, and the other carrier asks for 24% and 22% in these two markets – it looks like they pulled numbers out of a hat ,” she said.
State Attorney General William Tong requested a special hearing that would allow officials to gather evidence and cross-examine insurers about the proposed increase. Officials will be able to cross-examine witnesses and present their evidence in a public setting.
The insurance department did not agree to the formal hearing.
“Health care costs and insurance premiums are already unaffordable for many Connecticut families, businesses and individuals, and these double-digit rate increases warrant rigorous scrutiny,” Tong said.
When does open enrollment begin?
Open registration for the year 2023 the health policy starts on November 1.