AHIP's Marilyn Tavenner predicts premium hikes in 2017

The head of the health insurance industry's largest trade group says she expects premiums for Affordable Care Act exchange plans to go up significantly this year. The Obama administration, though, disagrees.

In an interview with Morning Consult, America's Health Insurance Plans CEO Marilyn Tavenner says she thinks ACA plan premiums will be higher in 2017 than they were in previous years. First, general medical cost trends, which typically increase from year to year, suggest premiums will increase, she says.

She also points to high growth in pharmaceutical spending as well as the market shifts tied to the ACA--such as caps on insurers' profits and strict benefit design regulations.

What's more, as a previous report from the Blue Cross Blue Shield Association pointed out, many new ACA exchange customers were costlier and sicker than expected. The market also isn't as stable as originally predicted. More than half of the consumer operated and oriented plans have closed and UnitedHealth recently announced it would be leaving many exchanges.

Still, Tavenner notes that rates are difficult to predict given the many variables from market to market and even within markets.

For his part, Department of Health and Human Services spokesman Ben Wakana pointed to a recent report from HHS that he says "debunks the myth, based on last year's rate filings, that average consumers experienced double-digit percentage premium increases for coverage" in 2016, according to the article. Therefore, he argues, consumers should avoid panicking about insurers' rate requests until the rates are finalized

To learn more:
- here is the article