Georgia to See Up to 198 Percent Premium Hikes Under Obamacare

Wednesday, 31 Jul 2013 02:46 PM

By Sandy Fitzgerald

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Georgia residents will see their health insurance rates skyrocket by up to 198 percent when Obamacare kicks in, state Insurance Commissioner Ralph Hudgens said in a letter to the Department of Health and Human Services Monday.

The higher costs are "in complete contradiction to every promise made by the president," Hudgens said in the letter, sent out two days before the July 31 deadline for states to report new insurance rates for health insurance exchanges run by the federal government, reports The Washington Free Beacon.

Hudgens' letter, written to HHS Secretary Kathleen Sebelius, asks that Georgia's deadline for reporting the insurance rates be extended for one month, so his office can investigate the higher premiums.

"Georgia consumers cannot afford these massive rate increases," Hudgens wrote to Sebelius. "In addition, I am requesting that your department show cause why these massive requested rate increases are not justified" under Obamacare.

Jay Florence, a state insurance department official, said the cost of insurance in the exchanges was compared to what people now pay for coverage, and revealed rates were going up for every age group.

For example, premiums are to rise 85 percent to 198 percent in the exchanges for a 25-year-old man, said Florence, and premiums will rise by 40 percent to 100 percent for an average 45-year-old man.

"The delay is simply trying to give the administration an opportunity to explain that and maybe explain what our actuaries weren’t able to determine, which is that these rates are excessive," Florence said.

"I want to protect the consumers of the state of Georgia but when these things are going up, these prices are going up, I don’t want people to blame me," Hudgens told The Atlanta Journal-Constitution

Other experts, though, say the filings appear to not be typical, and question them.

"The majority of Georgians with individual coverage will not see rate increases anywhere near that amount, and many will see rate decreases," said Bill Custer, a Georgia State University healthcare expert.

A HHS Department spokeswoman said Tuesday the agency is reviewing Georgia's request for an extension while the rates are being considered.

"We are working closely with states to help them meet all deadlines and ensure that the marketplaces are ready for consumers to begin shopping on Oct. 1," she said.

The Journal-Constitution reports that outside actuaries have reviewed the plans, comprised of seven companies seeking to sell insurance on the exchange, and found that six are appropriately priced.

There are several reasons the rates could be going up so high, according to other experts. For example, Ed Haislmaier, a health care expert at the Heritage Foundation, said "age rating" may be coming into play, reports The Free Beacon.

With age rating, insurance companies must charge elderly people no more than three times what they charge younger people, lowering the price for coverage for older people but raising it for younger customers.

"That in and of itself would have a direct, almost mechanical impact on rates," said Haislmaier.

However, Hudgens says he wants Sebelius to assess if the prices are appropriate.

"I am really waiting for her to come back and tell me whether she thinks they are excessive," said Hudgens.

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