The biggest health insurance carriers in nine states are planning huge premium increases for hundreds of thousands of Obamacare consumers next year, The Wall Street Journal
The states, ranging from Rhode Island to Washington, are proposing an average rise of between 8.5 percent and 22.8 percent for individual health plans, according to a review of rate increase applications.
On the other hand, smaller insurance companies in those states are planning to pare their rates in a bid to entice new customers to their individual healthcare plans, according to the Journal.
Overall, 10 states have completed public rate filings, and the insurers with the largest enrollment in 2014 in each state either offered the lowest or second-lowest prices for coverage in the first year of the Affordable Care Act’s new exchanges.
But citing the rise in medical costs, the nine carriers with the dominant market in their respective state now feel comfortable enough to raise rates.
The increases range from 8.5 percent Anthem Inc. in Virginia to 22.8% from CareFirst for its BlueChoice plans in Maryland. The average rate rise, however, in most states is around 10 percent, while the biggest carrier in Maine is keeping rates flat, the Journal says.
In Oregon, Moda Health Plan Inc. which has 75 percent of the state market with 117,000 enrollees, has applied for a 12.5% increase for next year. The carrier says it needs to boost its rates across the board to offset greater medical expenditures and a lesser payout from a fund designed to counter the cost of sick enrollees.
But two Oregon plans are looking to undercut Moda by lowering their rates for next year. One of them, Oregon's Health CO-OP, a nonprofit start-up with fewer than 1,000 enrollees, plans to reduce rates by 21 percent.
Meanwhile, smaller carriers in Connecticut, Indiana, Maryland, Michigan, Oregon, Rhode Island and Washington, are looking to offer the cheapest rates in their states to consumers who want to buy silver plans for 2015, the Journal said.
The proposed increases by large carriers partly reflect the probable rise of medical inflation, projected of around 5.4 percent this year, according to Richard Evans, an analyst at SSR Health LLC, an investment-research firm in Montclair, New Jersey.
America's Health Insurance Plans, the main insurer lobbying group, maintains that prescription-drug have climbed steeply in recent months, pushing up the costs to healthcare companies.
"We have some very high $100,000 cancer drugs coming on at the end of the year," Karen Ignagni, the association's president and CEO told the newspaper.
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