Though it will be a minor rise, it will still be greater than the quarter before.
Individuals and small businesses who will have their health insurance policies renewed on October 1, 2012 should expect to see a base rate increase on their premiums of an average of 2.1 percent on Massachusetts policies.
This is a much lower increase than the 5.5 percent the state added to its base rate in 2011.
According to the data at the state Division of Insurance, though Massachusetts has been very effective in keeping its health insurance rate hikes down to a minimum over the last couple of years, this most recent increase is larger than the 0.7 percent rise that was seen on July 1 for the renewals at that time. Regulators in that state have the authority to turn down hikes that are deemed to be excessive for self-employed people, individuals, and small employers.
In this circumstance, however, the division has allowed the health insurance price increases.
This new rate will apply to the premiums that will be paid by thousands of customers throughout the state’s small group health insurance market. Many among them, primarily employers, will need to pay a higher or lower amount than the actual average amount of the increase, as there are additional factors that must be taken into consideration, such as the type of business, its industry sector, the location, and the age of the workforce.
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According to the state undersecretary of consumer affairs and business regulation, Barbara Anthony, “This is a very slight increase.” She went on to explain that “If you look at the data since 2010, there’s been a continued moderation in average rate increases. Compared to where we were two years ago when average base rate increases were in the teens, they’re now in the low single digits.”
A number of different health insurance companies have requested lower rates for their fourth quarter renewals. These include Fallon and Tufts’ plans. The largest plans in Massachusetts, however, including Harvard Pilgrim and Blue Cross Blue Shield, have each increased their rates. Anthony spoke of the Patrick administration to point out that it is making strict efforts to keep the costs of medical care to a minimum by signing a law that allows spending to rise at a rate that is no faster than that of the economy from now through 2017.