Michigan insurers are raising rates on coverage, but by a modest degree
Insurance premiums in Michigan are set to rise next year. The Michigan Department of Insurance and Financial Services has approved rate increase proposals that will affect small businesses and individuals in 2016. For small group health insurance coverage, rates will rise by a very modest degree, while those with individual coverage will see a greater increase in their premiums beginning next year. Rate proposals were approved in order to allow insurers to recover from losses they had experienced in the previous year.
Small group coverage premiums to rise by 1% with individual coverage rising by 6.5%
For small group coverage, insurance premiums will be increasing by an average of 1%. For individuals, rates will increase by an average of 6.5%. Some will see greater increases in their premiums, which will be affected by a wide range of factors, including medical condition and similar issues. Premiums are increasing by a much smaller margin in Michigan when compared to what is being seen in other states. Several states are reporting premium increases of 10% and more, which may be placing consumers under significant financial stress.
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Some insurers seek premium hikes of more than 10%
While, on average, the average rate increase for coverage in the state are quite modest, insurers had initially sought to raise rates by a more significant margin. HealthPlus of Michigan, for instance, had requested a rate increase of 35% for small group policies. The insurer had received approval to increase premiums by 37% for individual plans, as well. Other insurers had sought much more modest rate increases, however.
Increase in health insurance premiums are expected to affect more than 900,000 people throughout the state
Rate increases are expected to affect more than 900,000 consumers throughout the state. For individual coverage, insurers believe that rate hikes are necessary in order to account for the rising cost of medical care. As health care services become more expensive, insurers are seeing greater losses as they continue to provide coverage to their policyholders.