CareFirst Proposes 25% Rate Increase
|By Andrea K. Walker, The Baltimore Sun|
|McClatchy-Tribune Information Services|
CareFirst BlueCross BlueShield wants to raise rates an average of 25 percent on those who buy coverage individually.
People with pre-existing conditions were denied coverage prior to health care reform, keeping insurance costs down.
In recent years, rates for individual insurance coverage have risen an average of 7 percent to 11 percent, according to various studies.
"We have always supported the intent and goal of the Affordable Care Act, but this is the practical result of it by opening the pool to everybody," Burrell said.
The rate increase must be approved by the
"I want to stress that these rate filings reflect the carriers' requested rates," said Maryland Insurance Commissioner
The rate proposals are for health insurance plans that would be offered under a state exchange -- an open marketplace where people would be able to shop for insurance. Most people would continue to purchase insurance through job-based plans separate from the exhange.
Burrell said small businesses purchasing through the exchange would see
Older individuals could see decreases under the proposed rates, but younger people could see increases of as much as 150 percent, reflecting limits on how much rates can vary based on age, Burrell said.
Insurance companies around the country have been warning about higher rates because increased fees required under health care reform and the higher expense to cover more people, said
"What all these companies are doing is they are trying to pass it along," Heupel said.
Advocates for health care reform have argued that it ultimately will help stem rising costs and may even reduce premiums as more people are required to buy insurance. Part of the law is designed to limit insurance companies' profits. But even advocates acknowledged that insurers would raise rates for many at first.
Other insurers proposed lower rate increases than
"It is a brave new world and there is great deal of uncertainty," said Dr.
"While we have taken great care to ensure that our projections are as accurate as possible, health exchanges are new territory for the industry, and many uninsured individuals will be entering the market for the first time," said
Coventry did not provide an average rate increase as
In its proposal,
"We can confirm that some provisions of the Affordable Care Act appear likely to contribute to premium increases, while other provisions will contribute to reductions in premiums for the coverage that will be available starting in 2014," the company said in a statement.
A spokesman for Aetna said rate increases in the small group market would range from 12 percent to 16 percent. The company said the impact on the individual market would vary greatly because the new plans are different from what is offered currently.
Some health care providers worry higher rates could result in fewer patients using health care. Higher premium costs often translate to higher deductibles, and that could lead more consumers to avoid the costs of doctor visits, said
"Some of the women's OB/GYN groups we work with are seeing women not come in for their routine care as frequently," said Smit, who works with physician groups, community health centers and other health care organizations. "It could definitely have a negative impact on consumers as they try to balance what their premium costs are and their out-of-pocket expense."
The complex health care reform law and the uncertainties around it could be encouraging insurance actuaries to recommend much higher rates in an abundance of caution, said
If insurers set rates too low and lose money one year, they are precluded from raising rates to compensate the next year, he said. That could encourage insurers to err on the side of high rates, leaving open the possibility of rebates later.
"I think it's entirely expected," Haislmaier said of the proposed rate increases. "This legislation didn't just make one or two changes to the market."
Meanwhile, it's difficult to forecast how many businesses and individuals will opt to pay fines for lacking insurance, he said.
"These are big unknowns," Haislmaier said.
Coventry said its rate projections were driven by several factors, including new taxes and fees and the cost of benefits it is required to cover in its plans under health reform. Costs also will be affected by the general rise in health care expenses, rules that require coverage of even the sickest individuals and restrictions on how much premiums may vary because of age.
One of the factors the
"It is really important not to reach any conclusions about the filings but the insurers and ultimately what the rates will be," Quattrocki said.
Two new carriers,
"It is about getting people into affordable health care coverage and still remaining financially sound," he said.
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