Health insurance rates rising 10% in NY

The insurance premium rate increases came in well below the proposed rates sought by health insurers, which requested rate hikes of nearly 19% and 16.5% for individuals and small group plans, respectively.

But despite the effort, added costs from the final health insurance rate increases will only further strain New Yorkers struggling financially amid historic inflation.

State Department of Financial Services Superintendent Adrienne Harris asserted the approved rate increases are a result of rising medical costs and inflation putting "upward pressure on premiums," as well as the lingering impacts of COVID-19 on the health system.

How does the rate increase compare to previous years?

The state's decision to reduce the health insurers' proposed rate hikes, Harris added, is estimated to save individuals a total of about $167 million. Small group plans will save an estimated $632 million due to the difference between the proposed and final rates.

"With our rate actions announced today, we continue to prioritize the financial well-being of consumers while ensuring that New Yorkers have access to a robust, stable health insurance market," Harris said in a statement Wednesday.

Still, the final rates for next year exceeded recent years. For example, regulators last year approved average rate increases of 3.7% for individuals and 7.6% for small group plans. That was down from the 11.2% and 14%, respectively, sought by insurers.

Over 1.1 million New Yorkers are enrolled in individual and small group plans impacted by the rate increases, the state agency noted.

Insurers: Rates don't account for rising health care costs

Eric Linzer, president and CEO of the state Health Plan Association, which represents insurers, asserted the final rates for next year failed to "fully account for the factors driving underlying health care costs."

Those health care costs "are largely driven by significant increases in the prices drug companies, hospitals and providers are charging," Linzer said in a statement Wednesday.

"The proposed rates also reflected the continued effect of COVID, including ongoing testing, treatment and vaccination, as well as increased utilization and higher costs due to care that was deferred as a result of the pandemic," he said.

"The rate submissions were reasonable and appropriate, reflecting underlying costs and taking into account the premium reductions the state has imposed the last several years," he added.

Previously, Linzer also asserted inflation contributed to the need for higher rates next year.

The New York State Conference of Blue Cross and Blue Shield Plans also asserted the state should have allowed higher rates, citing rising costs linked to drug prices, state taxes, new mandates and COVID-19. The insurer group added it strived "to limit rate increases to the lowest amounts possible" in the face of those costs.

Both health insurance trade groups urged state lawmakers to approve measures in the future that address the factors driving up health insurance costs in New York.

For further details about final rates for 2023 for different health plans, visit the state Department of Financial Services website at dfs.ny.org or call the agency's hotline at(800) 342-3736.