Aug. 11--For the second summer in a row, Highmark Inc. proposes increasing rates by nearly 10 percent on health insurance plans it sells to Pennsylvanians with chronic medical conditions who can't get coverage elsewhere.

The state's largest health insurer is asking the state Insurance Department to approve increases that would take effect Jan. 1 and run through Dec. 31, 2013, it said in filings made public on Friday. Downtown-based Highmark said it needs to cover rising health care costs.

A statewide group is asking for a chance to address the matter.

"We need a public hearing to make sure these rates are fair and not unnecessarily discriminatory," said Antoinette Kraus, project director for the Pennsylvania Health Access Network.

If approved, the increases of 9.4 percent or 9.5 percent, depending on the plan, would generate more than $15 million for the company, its filings showed. Monthly premiums would rise for more than 38,700 members, Highmark spokeswoman Kristin Ash said.

The nonprofit Highmark needs to cover "increases in health care costs brought on primarily by higher hospital prices, an increase in physician and hospital costs and increased prescription drug costs," Ash said.

The plans are money losers, Highmark said. It covered $105.9 million in costs in 2011 and this year and expects to cover $56.5 million in costs next year.

In Western Pennsylvania, the rate increases could affect 25,200 Highmark members with Special Care, KeystoneBlue for Kids HMO, Classic Blue Traditional, Preferred Blue PPO and PPO Blue High Deductible plans.

In Central Pennsylvania, 13,500 members with Special Care, Classic Blue Traditional, Classic Blue Comprehensive and PPO Blue High Deductible plans could pay more.

The plans are guaranteed issue plans, which means Highmark does not deny coverage to people with pre-existing medical conditions. Most for-profit insurers will not cover people with such conditions.

Insurance Department spokeswoman Rosanne Placey said the department will accept public comments on Highmark's requests for 30 days, starting on Saturday. Depending on the number and nature of the comments, the department might hold a public hearing.

"Public comment is always considered in the rate review process," Placey said.

Last summer, Highmark asked for 9.9 percent increases on its guaranteed issue plans. After public outcry, the insurer lowered its proposed increase for the Special Care plan to 4.9 percent, which the department approved in October.

Special Care became the primary individual plan for low-wage earners after the state dropped its subsidized adultBasic plan in early 2011.

Premiums under adultBasic were $36 a month. After last year's increase, Special Care costs about $170 a month. If the department approves the latest proposed increase, the premium would rise to about $185 a month, or more than $2,200 a year.

Kraus, of the access network, said she finds it interesting that Highmark asked for a 9.5 percent rate increase instead of 10 percent. Under the 2010 federal health care law, insurers that raise rates on individuals or small businesses by 10 percent or more are required to publicly justify the reason.

"It just shows they really don't want to be subjected to a rate review process," Kraus said.

Under state law, health insurers must receive approval to raise rates on individuals and small businesses. The premiums Highmark and other insurers negotiate with large employers are not subject to review.

Health insurance experts have said that rates did not rise, and likely fell in some cases, during the past year because Highmark faces greater competition from UPMC Health Plan and four national for-profit health insurers.

Alex Nixon is a staff writer for Trib Total Media. He can be reached at 412-320-7928 or anixon@tribweb.com.

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