Pre­mi­ums could spike

State health in­sur­ers aim for an av­er­age of a 27 per­cent in­crease.

The Denver Post - - FRONT PAGE - By John In­gold

Colorado health in­sur­ers are ask­ing to charge cus­tomers in the in­di­vid­ual mar­ket nearly 27 per­cent more on av­er­age in pre­mi­ums next year, the state Divi­sion of In­sur­ance an­nounced Fri­day.

The divi­sion must still re­view and ap­prove the re­quests — af­ter re­ceiv­ing pub­lic com­ment. But in­sur­ers can back out of the mar­ket if the state doesn’t OK their premium hikes.

Colorado In­sur­ance Com­mis­sioner Mar­guerite Salazar said in a state­ment that the large pro­posed in­creases were not a sur­prise.

“I be­lieve that the du­bi­ous sit­u­a­tion at the fed­eral level has con­trib­uted to the premium in­crease re­quests we’ve seen from the com­pa­nies,” she said.

In a later in­ter­view, Salazar said she has heard in­sur­ers and other in­sur­ance com­mis­sion­ers re­fer to the in­sta­bil­ity as the “Trump Fac­tor” that ev­ery in­surer is pric­ing into its plans.

“The car­ri­ers just don’t know what’s go­ing to hap­pen,” she said.

In fil­ings with the state, though, in­sur­ers cited mul­ti­ple rea­sons for the in­creases.

Cigna, which is re­quest­ing the largest rate in­crease at 41 per­cent, said Colorado’s mar­ket turned out to be “more ad­verse than as­sumed in the cur­rent rates,” mean­ing it had cost more for the com­pany to pro­vide cov­er­age than ex­pected. Rocky Moun­tain Health Plans, which op­er­ates only in Mesa County and is re­quest­ing the small­est in­crease at 12 per­cent, said it flat-out lost money in prior years.

“The fi­nan­cial ex­pe­ri­ence of the

prod­uct was worse than ex­pected,” the com­pany wrote in its fil­ing.

But other plans nod­ded to­ward chang­ing fed­eral reg­u­la­tions and the tu­mult they could bring. For in­stance, Colorado Choice Health Plans said it is con­cerned the Trump ad­min­is­tra­tion will weaken en­force­ment of the so-called in­di­vid­ual man­date, the law that every­body must have health in­sur­ance. If that hap­pens, healthy peo­ple might aban­don the mar­ket, leav­ing in­sur­ers cov­er­ing a smaller pool of sicker peo­ple.

The in­creases would not ap­ply to peo­ple who get cov­er­age through their em­ploy­ers — as about 51 per­cent of Coloradans do. In­stead, they would only hit peo­ple who buy health in­sur­ance plans on their own. Tax cred­its, which rise un­der cur­rent law as the cost of plans rises, could also take some of the sting out of the pro­posed in­creases.

The new rates would es­pe­cially im­pact ru­ral ar­eas, where in­sur­ance is al­ready costly.

An­them, which is the only car­rier of­fer­ing plans that com­ply with the Af­ford­able Care Act in 14 western Colorado coun­ties, is re­quest­ing in­creases above 30 per­cent. Colorado Choice Health Plans, which is the only in­surer be­sides An­them of­fer­ing plans in sev­eral south­ern and east­ern Colorado coun­ties, is seek­ing in­creases of nearly 29 per­cent.

Mean­while, plans that fo­cus their of­fer­ings on the Front Range asked for lower premium in­creases — in­clud­ing 24 per­cent from Kaiser Per­ma­nente and 15 per­cent from startup car­rier Bright Health.

No more than 8 per­cent of peo­ple in the state shop for health in­sur­ance plans in the in­di­vid­ual mar­ket, though that still ac­counts for hun­dreds of thou­sands of peo­ple.

But prices in the in­di­vid­ual mar­ket have taken on out­sized po­lit­i­cal sig­nif­i­cance in de­bates over the Af­ford­able Care Act, also known as Oba­macare, be­cause they are one of that law’s most vis­i­ble mea­sure­ments of suc­cess or fail­ure.

As such, the 2018 premium prices have been the sub­ject of an­tic­i­pa­tion — and worry — for months. Colorado U.S. Sen. Cory Gard­ner, a Repub­li­can, has blamed the Af­ford­able Care Act for in­creases in pre­mi­ums. Salazar, who was ap­pointed by Demo­cratic Gov. John Hick­en­looper, said ear­lier this year that Repub­li­can health care ma­neu­ver­ing at the fed­eral level could cause mas­sive premium spikes.

Last year, Colorado saw premium in­creases of an av­er­age of 20 per­cent in the in­di­vid­ual mar­ket.

So far this year, in­sur­ers in states across the coun­try have asked for big premium price in­creases in 2018.

An is­sue brief pub­lished this week by the Amer­i­can Academy of Ac­tu­ar­ies cites two fac­tors in premium in­creases across the coun­try, and nei­ther has to do with the Af­ford­able Care Act, also known as the ACA. First is the in­crease in health care costs. Sec­ond is the un­cer­tainty brought about by the Repub­li­cans’ still-be­ing-de­bated health care bills.

“In the last sev­eral years, in­sur­ers have gained much more in­for­ma­tion about ACA plan en­rollees, costs, and the op­er­a­tion of the cur­rent mar­ket rules, while un­cer­tain­ties sur­round­ing the fu­ture of those rules have be­come more pro­nounced,” Cori Uc­cello, a se­nior health fel­low at the academy, said in a state­ment.

A fed­eral re­port re­leased last month gave Colorado’s in­sur­ance mar­ket the low­est risk score in the coun­try, a sign, health an­a­lysts said, that the un­der­ly­ing mar­ket is sta­ble and not col­laps­ing.

For 2018, there are seven in­sur­ers propos­ing to sell in­di­vid­ual plans, “on ex­change.” That means the plans will com­ply with ACA reg­u­la­tions, they will be el­i­gi­ble for fed­eral tax cred­its to help pay for pre­mi­ums, and they will be avail­able for pur­chase on Con­nect for Health Colorado.

Nine in­sur­ers are of­fer­ing to sell in­di­vid­ual plans “of­fex­change” that aren’t el­i­gi­ble for tax cred­its. The 27 per­cent av­er­age pro­posed cost in­crease in­cludes plans both on and off the ex­change.

The “small-group mar­ket,” where small em­ploy­ers can buy health in­sur­ance plans for their work­ers, is ex­pected to be more sta­ble in 2018. In­sur­ers in that mar­ket re­quested a roughly 7 per­cent av­er­age in­crease in pre­mi­ums. Salazar said that mar­ket tends to cover health­ier peo­ple but is also some­what less sus­cep­ti­ble to the ups and downs of the fed­eral health de­bate.

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