Health Insurance Hikes Causing Marylanders To Reconsider Cost
EASTON - The health insurance enrollment period ends Friday, Dec. 15, and as the closing date looms, many Marylanders are weighing the pros and cons of opting out of insurance altogether, due to the newly increased rates.
Earlier this year, insurance providers requested an increase in rates, anywhere from a 65 percent to as little as 2 percent, with CareFirst requesting increases up to 62 percent for some plans.
In response to those requests, the Maryland Insurance Administration conducted in-house and third party reviews of rates, member services and held community forums, prior to approval.
During one of the statewide forums, Insurance Commissioner Al Redmer said the problem is the disproportionally large amount of sick people who are buying the insurance plans, versus healthy people who are opting out of insurance plans altogether.
"The sick are ringing the bell with medical expenses," Redmer said. "The problem is not the size of the group. The problem is, disproportionally, they are older and sicker. The issue is how do you get the price low enough to encourage healthier, younger folks back into the market."
Redmer said CareFirst received a 25 percent increase last year, and when that increase hit, consumers had to make a choice whether to "suck it up," or drop insurance and go without coverage.
In August, MIA approved rate increases but many were below the requested hike.
The average increase for CareFirst, United Healthcare of the Mid-Atlantic and Aetna Life will be 33 percent versus the originally requested 43.1 percent.
In a press release from CareFirst CEO Chet Burrell, he said the requested rates are unfortunate, but necessary.
"We have reached the point where individual health care premium rates are too high to be readily affordable by the general public. The rapid rise in these premiums puts coverage out of reach for many especially those who do not qualify for federal subsidies under the Affordable Care Act," Burrell said. "Premiums reflect the high costs associated with those seeking coverage. This is certainly true for those who have coverage with CareFirst."
The MIA said the rate increase can be attributed to the reinstatement of the health insurer fee, healthy members leaving the market, claims costs rising at about 8 percent annually and actual claims experience being higher than expected.
More than 90 percent of Marylanders are covered by health insurance plans offered through large employers or employers who self-insure, or participate in "grandfathered" plans purchased before March 2010 or in federal plans such as Medicare, Tricare or federal employee plans.
For these Marylanders, the rate increase will not affect their rates, however for the remaining 243,0000 Marylanders, the rates may jeopardize whether or not they continue to purchase health insurance.
For the small group market the MIA concluded approximately 257,000 Marylanders are enrolled in small group plans, with 144,696 insured by CareFirst BlueChoice.
The small group market consumers can expect their health insurance rates to increase by an average of 1.7 percent versus the originally requested 4.2 percent.
For the individual nonmedigap market summary, the MIA concluded that approximately 243,000 Marylanders are enrolled in individual health plans, with CareFirst BlueChoice providing insurance for 158,835.
With deadlines for open enrollment fast approaching these increases are now coming to fruition and local families are struggling with opting out.
Kimberly and Brian Sauerhoff of Greensboro are facing a nearly $60 per month increase for his private insurance plan through Blue Cross and Blue Shield.
"He's on young adult HMO. (The) original deductible was $7,150 and it's getting hiked up to $7,350," Kimberly Sauerhoff said. "Rate change is increased by $58.98 monthly, or $707 a year."
Due to the increase she and her husband are considering cancelling his insurance.
"We are canceling it on Jan. 1, before the increase," Sauerhoff said. "We simply can't afford it. It's almost another car payment each month."
Pam Phillips of St. Michaels said she and her husband are self-employed and they are looking at a monthly increase of $1,500.
"It's a huge price jump, I am contemplated not having it," Phillips said. "But health issues are scary too."
Through the market place at Maryland Health Connection, individuals may qualify for Medicaid or a reduced premium depending on size of their family and their annual household income.
For instance, a single male with no children and an annual income of $16,643 qualifies for Medicaid, and if he makes over the previous mentioned amount but remains under $47,520 he may qualify for reduced premiums through the market place.
The Maryland Health connection boasts that 400,000 people in the state have gain coverage, including nearly 280,000 Marylanders who have free or low-cost coverage through the expansion of Medicaid.
But some families do not qualify for either and are simply opting out altogether.
"We don't qualify for help on the exchange either," Sauerhoff said. "It won't make a difference for him since he rarely goes to the doctor. I know if a hospital stay was involved we'd be screwed but we would have to take that risk financially right now."
According to the Maryland Health Connection website, "It is important for Marylanders to understand that the Affordable Care Act is still the law of the land, and you may still pay a penalty for not having health insurance."
For 2016, the penalty for being uninsured is 2.5 percent of your gross household income, or $695 per individual - whichever is higher. The maximum penalty for 2016 is $2,085.
Some people are exempt from the requirement to have coverage and do not have to pay a fee even if they remain uninsured. Such exemptions must be approved by the federal government and include not being able to afford coverage due to a hardship, religious objection to buying insurance, registered Native Americans or Alaska natives, or being incarcerated.
For more information about the marketplace or to qualify for assistance visit www.marylandhealth connection.gov.
BRIEF: Fisher-Titus now part of Medical Mutual Mercy Health HMO Network
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