NH insurer seeks 30% rate hike

June 06--The second-largest insurer in the New Hampshire Obamacare market said his company has requested average rate hikes of 30 percent next year, blaming the increase on two provisions of the health care law -- Medicaid expansion and federally imposed risk adjustments.

Minuteman Health Chief Executive Officer Tom Policelli disclosed the preliminary proposal in a newspaper interview on Monday. He said Medicaid-expansion customers, who don't pay any premiums or deductibles, won't feel any impact, and subsidized Exchange customers will feel very little.

The increase will fall most heavily upon the 20,000-plus Exchange customers who are not subsidized.

"This is a shadow tax on a very small population, and will likely make individual coverage too expensive for many," reads a statement in a PowerPoint presentation that Minuteman gave last Wednesday in a symposium on Medicaid.

Friday was the deadline for insurers on the Exchange to submit proposed rates for 2018 to the New Hampshire Insurance Department.

Four insurers are writing policies on the Exchange this year. While state insurance officials have said the market is stable, they have expressed worries about rate increases; on Friday, they announced guidelines for carriers to follow if they want to withdraw from the market.

In an email, Insurance Department spokesman Danielle Barrick said the Insurance Department is prohibited by law from releasing rate information before the first day that people can enroll on the Exchange.

However, the Centers for Medicare and Medicaid Services will release proposed increases of 10 percent or more, likely on Aug. 1, Barrick said. That information would be public. New Hampshire carriers can revise their proposals before July 3.

Anthem Blue Cross, the largest insurer in the state, would not discuss its filing. Anthem spokesman Colin Manning cited state law and said they are subject to revision.

NH Medicaid Today and Tomorrow: Focusing on Value

Policelli's interview on Monday followed a presentation he gave at a symposium on Medicaid last week at University of New Hampshire Law School.

Implemented under former Gov. Maggie Hassan, the Medicaid expansion system calls for most recipients -- about 50,000 -- to purchase their coverage through the Exchange with Medicaid dollars. New Hampshire is among only a handful of states to do so.

Minuteman insures about 27,000 New Hampshire customers. A PowerPoint presentation paints an actuarial picture of Minuteman's Medicaid-expansion customers.

--Medicaid-expansion clients use in-network behavior health and substance abuse services at a rate of 509 percent more than the rest of Exchange customers.

--They are at least twice -- and in one instance 10 times -- more likely to go outside of the Minuteman network for care, where prices are higher.

--Medicaid expansion clients are more likely to use emergency rooms and 911 ambulance when unnecessary. They are also less likely to use outpatient or professional services.

--The regular Medicaid population is under managed care and assigned a primary care physician. No such requirement exists under the Medicaid-expansion population.

Policelli stressed that he's not against Medicaid expansion. He proposes moving Medicaid-expansion customers into their own risk pool.

He said the Medicaid expansion is only responsible for about a third of the proposed Minuteman rate increase for next year. The Obamacare program of risk adjustment, which spreads one insurance carrier's loss among other carriers, is responsible for about two-thirds of the increase, he said.

Most of the premium dollars that Minuteman would transfer would go to Ambetter, which only insures Medicaid-expansion clients, he said. Policelli said he would have to use customer premiums to pay for the transfer to Ambetter.

The program is not working, he said. An email to Ambetter was not immediately returned.

"What's going to drive rates higher is not medical costs. What's going to drive rates higher is unintended results of policy decisions," Policelli said.

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