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| Zach Gibson / New York Times |
Reporter Robert Pear’s
article in The New York Times (7/3/15) entitled “Health Insurance Companies
Seek Big Rate Increases for 2016” explains how “health
insurance companies around the country are seeking rate increases of
20 percent to 40 percent or more, saying their new customers under the Affordable
Care Act turned out to be sicker than expected.” Federal officials say they
are determined to see that the requests are scaled back.
“Insurers with decades of experience
and brand-new plans underestimated claims costs. Blue Cross and Blue Shield
plans — market leaders in many states — are seeking rate increases that average
23 percent in Illinois, 25 percent in North Carolina, 31 percent in Oklahoma,
36 percent in Tennessee and 54 percent in Minnesota."
The Oregon insurance commissioner just approved 2016 rate increases for companies that cover
more than 220,000 people. Moda Health Plan, which has the largest enrollment in
the state, received a 25 percent increase, and the second-largest plan,
LifeWise, received a 33 percent increase.
Jesse Ellis O’Brien, a health advocate
at the Oregon State Public Interest Research Group, said: “Rate increases will
be bigger in 2016 than they have been for years and years and will have a
profound effect on consumers here. Some may start wondering if insurance is
affordable or if it’s worth the money.”
Sylvia Mathews Burwell, the secretary
of health and human services, said that federal subsidies would soften the
impact of any rate increases. Of the 10.2 million people who obtained coverage
through federal and state marketplaces this year, 85 percent receive subsidies
in the form of tax credits to help pay premiums.
The good news is that there are more
insured consumers. There are opportunities for health care providers and
businesses. Consumers may buy catastrophic insurance to keep costs low and pay cash for everyday care where they can choose their own physicians.
The money is going to the insurance carriers. How will the money trickle down from the carriers to the
providers? There is a pent up demand and
my physician clients who provide primary care are completely overwhelmed. This will change but it will take some years
for this to adjust and the price levels to become predictable and for providers
and businesses to have an idea of what life will be like in 5 years.
Posted by Tracy Green, Esq.
Green and Associates, Attorneys at Law
