Health insurance firms seek double-digit hikes

HARRISBURG — Health insurance companies made the case for double-digit rate increases next year for individual policies in Pennsylvania at a regulatory hearing Wednesday.

The requests before the Insurance Department include proposed average rate increases ranging from 17.2 percent for Aetna Health Inc., 25.4 percent to 48.1 percent for Highmark companies, 0.9 percent to 16.2 percent for UPMC companies, and 19.9 percent to 22.5 percent for Independence Blue Cross companies, according to the department.

Insurance Commissioner Teresa Miller described the proposed rate increases as large but said they are not unique to Pennsylvania.

Arthur Lucker, an actuary with INS Companies, said the consulting firm is seeing an average increase of about 22.5 percent in states where it is reviewing rates.

Five percent of Pennsylvania health insurance customers — more than 500,000 people — have coverage through individual plans, according to the Insurance Department.

Speaking at the hearing, insurance executives cited factors including the rising cost of health care and the expiration of government programs intended to stabilize premiums after the passage of the Affordable Care Act.

“The underlying cost of providing services continues to go up, forcing health insurance companies to raise rates in order to cover the cost of services,” said Jeffrey Scheib, vice president of actuarial services at Highmark Inc.

Rates are the base price for health insurance. Companies then calculate premiums, the amount policyholders pay for coverage, by considering age, location, tobacco use and family size.

Regulators must approve rates before policies can be sold to

consumers, ensuring that they are priced neither unfairly high nor too low to maintain a stable and competitive market. The Insurance Department is scheduled to announce its determinations in October, ahead of the Nov. 1 start of the open enrollment period. The rate requests were made public in May.

Antoinette Kraus, director of the Pennsylvania Health Access Network, urged the department in a statement to ensure rates are fair and do not discriminate.

A group with the campaign Put People First! PA sat in the hearing room wearing red shirts, some of them labeled with the words “Health Care is a Human Right.”

One citizen speaker, 60year-old Orlanda Smith of Philadelphia, traveled to Harrisburg to ask that the rate increase requests be denied. She said afterward that after retiring from the city for medical reasons, she last year purchased an individual plan and has been dismayed by the costs. She said she has stopped taking a medication she had been taking for years because she cannot afford it.

“After working 37 years, hard, long years, I didn’t expect that if I got sick, that I would have no coverage that I can afford to pay for,” she said.