Regulators deny insurers the ability to raise rates on 2015 policies
The Connecticut Insurance Department has denied rate increase proposals from two insurance companies that had sought approval to raise premiums by at least 12% in 2015. One of the companies seeking an increase in premiums was Anthem Blue Cross, which had wanted approval to increase its rates by an average of 12.5%. State regulators have deemed this request “excessive” and denied the proposal, requiring the insurer to submit a new rate proposal for policies it plans to sell in 2015.
Anthem rate increase proposal rejected by state regulators
Anthem Blue Cross recently faced scrutiny in the wake of a public hearing that was held in June of this year. The rate proposals coming from the insurer had been demonstrated to be excessive and unsupported by the evidence that the company had provided. Insurers are required to provide evidence justifying rate increases if they want to raise premiums by 10% or more. Insurance companies often cite the rising cost of medical care as the reason for higher rates, but this reason alone is not enough to justify rate increases.
Rejected proposals hailed as a victory for the Affordable Care Act
The decision to reject rate increase proposals coming from the state’s insurers is being heralded as a victory by the Connecticut Congressional delegation. The decision is supported by the regulatory structure that has been established by the Affordable Care Act. The federal health care reform law has established a framework that insurers can use to effectively regulate insurance rates. Using this framework, regulators have the ability to require justification from insurers when they seek what can be considered “excessive” rate increases.
Some insurers are seeking rate reductions rather than increases
Not all insurance companies are looking to raise rates for the coverage they provide. HealthyCT has submitted a request for a rate reduction of 8.6%. State regulators have opted to approve a 8.5% reduction for the health insurance company. UnitedHealthcare has also been asked to submit proposals for rates for the policies it will be selling through the state’s insurance exchange next year.