Many insurers are proposing increased rates for insurance plans created under the Patient Protection and Affordable Care Act as a result of the high medical costs incurred in 2014 for the newly insured, according to The Wall Street Journal.
Here are three things to know about the proposed rates.
1. So far, payers are seeking to boost rates in every state except Maine. In states like Tennessee, New Mexico, Oregon and Maryland, these are not small boosts. For example, Maryland's CareFirst BlueCross BlueShield is seeking a 30.4 percent average increase on premiums in 2016. For a 40-year-old nonsmoker living in Annapolis, the monthly premium for a midrange plan would increase from $244 to $306 in 2016, according to the report. Some states are requesting more modest increases, like Anthem in Virginia, which is asking for an average increase of 13.2 percent or in Indiana, where the leading plan seeks a 3.8 percent increase.
2. Payers say actuarial science is behind the increases. The increased rates are due to the high medical costs of the newly insured, payers say. CareFirst, for example, said its monthly claims per member increased from $197 in 2013 to $391 in 2014, according to the report. Rising premiums also reflect sky-high prescription prices, according to the report.
3. Proposed rates can still be rejected. Any payer seeking to increase premiums more than 10 percent can be rejected if it is not able to justify the increase, according to the report. "After state and consumer rate review, final rates often decrease significantly," Aaron Albright, a CMS spokesman told The Wall Street Journal. Rates will be finalized later this year.
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