Oregon's Insurance commissioner cautioned insurers he wouldn't hesitate to reduce their proposed premium rates if they weren't justified. And Lou Savage followed through with his warning, slashing several rates by as much as 35 percent in one case.
Insurers submitted individual rates for standard "bronze" plans last week that will be sold both on and off Oregon's health insurance exchange. Monthly premium costs for a 40-year-old single male nonsmoker varied from Moda Health Plan's $166 to FamilyCare Health Plan of Oregon's $274, reported the Portland Business Journal.
But Savage's office cut almost every insurer's premium requests by anywhere from 1.8 percent to 35 percent. At the higher end of the cuts, Savage reduced FamilyCare's rates by 35.1 percent, Trillium Community Health Plan by 32.4 percent, Time Insurance by 28.4 percent and Health Net by 27.5 percent, The Oregonian reported.
Only one day after the Oregon insurance commissioner dropped premiums by 35 percent, FamilyCare announced it was pulling out of the state's individual market next year, The Oregonian reported in a follow-up article.
But FamilyCare CEO Jeff Heatherington clarified the decision wasn't related to the rate slash, saying the Oregon individual market didn't fit it's business model. He added that the company actually hoped the insurance department would cut its rate after it realized how low some of its competitors' rates were.