Regulators approve rate increase proposal
The Massachusetts Division of Insurance has announced the approval of a health insurance rate increase throughout the state. The increase is expected to have an effect on individuals and small businesses and will come from one of the state’s largest insurance companies. Initially, insurers had sought approval for large rate increases, typically 10% or higher. State regulators, however, have succeeded in keeping rate hikes at or below the 2% threshold for nearly two years running. With health care reform bringing significant changes to health insurance regulations, rate hikes have been a popular topic in the world of insurance news.
Blue Cross Blue Shield wins bid for 1.2% rate hike
Regulators note that consumers can expect to see health insurance rates jump by an average of 1.2% throughout the state. The rate increase comes from Blue Cross Blue Shield. Those without HMO coverage will see their premiums jump by an average of 2.6%. How much premiums will increase is dependent upon several factors, such as a policyholder’s medical history and their place of residence. Regulators suggest that some consumers may see rates spike higher than 1.2%, but these rates are not expected to be excessive.
Two insurers will reduce their rates this year
The Division of Insurance has also announced that two of the state’s largest insurance companies will be reducing health insurance premiums beginning July 1, 2012. These reductions are expected to be continuous over a three month period and are likely to bring major savings to policyholders throughout Massachusetts. After the three month period has passed, regulators expect rates from these two insurance companies to begin climbing once again.
Regulators enjoying expanded authority over rate review process
Massachusetts insurance regulators have been exercising their expanded rate review authority that was provided through legislation from Governor Deval Patrick. The governor is currently working to further expand this authority with new legislation that seeks to moderate all health care costs in the state. The bill has already garnered support from several legislators, but has met some opposition amongst the state’s insurance industry.