As health insurance premiums rise, CT officials say system is broken. Word ‘unsustainable’ spoken often.

About 220,000 people in the state are expected to see, on average, double-digit health insurance premium hikes in 2027, which lawmakers say is unsustainable for many.

“I think the rates that were finalized speak to the underlying failure of the system that we have in place right now,” said State Comptroller Sean Scanlon. “And that failure to fix it has led to unsustainable cost increases for the people of Connecticut.”

Last week, the Connecticut Insurance Department announced its approval of the rate hikes covering individual and small group health insurance plans on and off the Access Health CT health insurance exchange.

After evaluating five filings from four insurers, CID approved an average increase of 11.3% in the individual market and 15.1% in the small group market, according to information from CID.

Initially, insurers requested average increases of 16.2% in the individual market and 17.8% in the small group market.

CID’s adjustments reduced projected premium increases by ‘more than $100 million and limited insurer profits to less than 1% of premiums,” according to CID.

Experts, CID and lawmakers say the rising cost of healthcare and pharmaceuticals are significant factors in the insurance premium hikes. The Trump administration’s decision to discontinue federal subsidies at the end of last year that helped cover premium costs for Affordable Care Act plans also contributed to the problem, according to state officials.

“We have to look at this from a broader perspective,” said Angela Mattie, professor in the School of Business and in the School of Medicine at Quinnipiac University. “It’s easy to say, well, the insurance companies are the villains. The insurance companies are basically the end and the tail. It’s the rising healthcare costs, the acute care costs, the pharmacy costs — all the costs associated with providing healthcare.”

This year, Gov. Ned Lamont announced the state would provide financial assistance to help cover some of the premium costs due to the discontinuation of federal subsidies.

Cathryn Vaulman, communications director for the governor, said Lamont intends to continue to provide that financial assistance in 2027.

Both Republican and Democratic lawmakers are calling for legislation to reform healthcare in the state next year.

Senate Republicans say they offered a plan last session, which they argue would reduce insurance premiums 15% to 30% through Association Health Plans, allowing small businesses and nonprofit employees who are not covered by their employer to pool resources to find coverage as a group.

But Democrats described the plan ‘as a red herring,’ saying they do not offer all of the consumer protections of the Affordable Care Act.

A CID spokesperson said in an email that while most states have yet to finalize their 2027 health insurance rates, the state’s increase is consistent with trends and finalized rates approved in other states.

Asked what is the average cost increase for premiums for those with Anthem, ConnectiCare and UnitedHealthCare plans, a CID spokesperson said there is no single percentage that applies to every customer because rates vary depending on the plan, insurer and market.

Attorney General William Tong said the rate increases are unsustainable, saying that families are “left to drown in ballooning premiums, deductibles, coinsurances and copays.

“This is not on CID — by the time these rate increases hit their review, it’s far too late,” he said. “We need insurers, hospitals, pharmacy benefit managers and every player from top to bottom at the table to earnestly negotiate cost relief way before these rate demands are crafted.”

‘You can blame the insurance department for an opaque process’

Sen. Jeff Gordon, a Woodstock Republican and physician, said he believed the insurance commissioner could do more to lower the rates.

“You can absolutely blame the insurance department for an opaque process,” he said. “I think they need to do a better job reaching out to the public and including the public in deliberations and they can take a strong stand and limit these really astronomical increases. And at the same time, I challenge state leaders to once again join a growing group of bipartisan legislators who keep advocating for Association Health Plans.”

Gordon said the passage of Association Health Plans would make insurance more affordable “for a lot of people, small businesses, even nonprofit organizations and municipalities.”

“We need to be stronger in the laws that we put in place to hold insurance companies accountable,” he said.

A CID spokesperson said Association Health Plans are an alternative coverage option “but they do not change the underlying cost of healthcare and could have negative impacts on the small group market.

“The main drivers of this year’s rate changes include higher utilization of medical services, increased prescription drug costs, and broader cost trends seen in insurers’ claims data,” the CID spokesperson said.

Senate Pro Tempore Martin Looney, the highest-ranking senator, also expressed concerns about Association Health Plans.

“I do know that the so-called Association Health Plans that some people keep talking about are not the answer and merely act as a red herring in the debate on reforming healthcare in America,” he said in an email. “They are not even technically insurance plans. My main concern is that they do not offer all of the consumer protections of the Affordable Care Act, and that one employee with high health care costs, such as undergoing chemotherapy, could drive up premiums for the employer’s entire plan.”

He said he submitted testimony before the Insurance Department earlier this month, sharing the public’s frustration with the “insurance companies’ performance because they’re yet again requesting another double-digit increase that vastly exceeds inflation rates as well as Connecticut’s own benchmark target.

“It’s unclear to me why these insurance companies can’t do a better job of negotiating rates,” Looney said. “The insurers, the hospitals, and the pharmacy benefit managers all point at each other for the premium rate increases, but they take no responsibility themselves.”

State Sen. Jorge Cabrera, a Hamden Democrat, who is Senate chair of the Insurance and Real Estate Committee, said in an email that “America is the only wealthy country on the planet that doesn’t offer some form of universal health care.

“The existing system is obviously broken, so it’s time for a new system,” he said. “That’s the solution. The good news is that we took a major step in that direction in May, when Democrats passed a budget that calls for creating the Connecticut Option plan, which is designed to lower health care coverage costs and expand health care coverage.”

Scanlon said the Connecticut Option plan, which would allow small businesses and nonprofits with less than 50 employees to buy into the state’s healthcare plan, is “a new option and new choice for affordable health insurance.”

Gov. Ned Lamont said “healthcare costs are rising in an unsustainable way.

“That’s why I’m pushing for a Connecticut Option,” he said. “We need to achieve greater leverage to lower costs in a meaningful way.”

House Republican leader Vincent Candelora said it is clear that it is essential to make healthcare more affordable.

“We have to look at Medicaid reimbursement rates because my big fear is that if we just focus on the Connecticut Option, that’s essentially a single payer system and it’s going to put more strain on private insurance,” he said.

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