In an attempt to keep health insurance premiums affordable for consumers, state regulators have been asked to take a closer look at rate requests before granting them.
Healthcare.gov CEO Kevin Counihan sent a letter this week to insurance commissioners in each state and the District of Columbia, saying rates may not need to go up as much as some insurance companies have proposed for plans individuals buy on health exchanges.
First, recent experience may show an improved medical loss ratio, meaning customers were healthier, and thus less costly, than expected. For example, he writes, Anthem in Connecticut announced that it was lowering its rates from its preliminary filings for this reason.
Secondly, the administration expects risk pools will continue to get healthier. The Centers for Medicare & Medicaid Services (CMS) also remains committed to the risk corridor program, and believes that risk corridors collection will be sufficient to pay for all risk corridors payments.
Counihan points out that data suggest that underlying trends in overall medical costs remained moderate through the end of 2014 and into early 2015, despite the spike in pharmaceutical costs.
Finally, Counihan writes that CMS will pay all eligible claim expenses for the 2014 benefit year at a 100 percent coinsurance rate, instead of an 80 percent rate.
Separate studies have suggested coming rate increases, including a Kaiser Family Foundation study last month found that the proposed cost of a benchmark silver plan is, on average, 4.4 percent higher in 2016 than in 2015, and an Avalere analysis that found, based on proposed rate filings in the eight states that have complete data, silver plan rates will increase 5.8 percent.
But it's possible the true Affordable Care Act rates won't be seen until mid-2016, argues Forbes guest columnist Robert Laszewski, FierceHealthPayer previously reported. That's because by then, insurers will have had a few years of experience dealing with claims data under the ACA.
- here's the letter (.pdf)