Health insurance rates are going up in Connecticut again – though not by as much as insurance carriers had hoped.
According to Connecticut Insurance Department Commissioner Andrew N. Mais, rate increase requests in the individual market were reduced from the requested 8.6%, resulting in an average increase of 5.6%. In the small group market, the insurers’ requested premium increases were reduced 48% from a requested average of 12.9% to 6.7%.
Medical costs have increased about 8% to 9%, while prescription costs have risen about 10% to 11%, according to Mais.
The 222,700 members enrolled in individual and small-group plans are projected to save approximately $76 million next year due to the rate request reductions. Over two years, the Insurance Department said, its rate reductions have saved Connecticut consumers approximately $173 million.
“Working on behalf of consumers, the department was able to reduce the health insurance rate increase requests thanks to the hard work of our actuaries and professional staff, but we need to work to address the skyrocketing health care costs these premiums cover,” Mais said. “The unit cost of hospital inpatient and outpatient care has historically risen about 9% per year. Prescription drug prices have risen even higher.
“I will continue to work collaboratively with all stakeholders to find long-term solutions that promote access and eliminate barriers to coverage here in Connecticut,” the commissioner said. “The health care cost changes make the work we have been doing with the Office of Health Strategy and the governor’s office to create viable solutions to this crisis even more essential.”
Mais also urged consumers to visit the state’s Affordable Care Act Exchange, Access Health Connecticut: “Whether or not you now have an Access Health plan, you may be able to find significant savings on a top-notch product by shopping there.”
Enhanced federal subsidies under the American Rescue Plan Act of 2021 (ARPA) lowers the cost of coverage available through Access Health CT to the lowest it has been in recent years. The amount of those tax credits depends on a person’s income and where they live.
Many individuals on the exchange who already receive subsidies will experience even larger ones in 2022 and those above 400% of the Federal Poverty Level who may not have received subsidies previously will see a reduction in premiums as the maximum premium they can pay under ARPA is 8.5% of household income.
As an example, the Insurance Department said a 45-year-old single person in Fairfield County earning $38,000 annually will see the cost of one plan drop from $306/month now to $193 per month, a savings of more than a third. That same person who now makes $64,000 per year will see costs drop under that plan from $633 per month to $456 per month in 2022.
Medical and prescription drug trends that reflect rising health care costs including hospital inpatient and outpatient and prescription drug costs are among the major factors contributing to the approved rates. Those factors continue to outpace the trend in professional provider unit costs.
The Insurance Department received 15 rate filings from 11 health insurers for plans that will be offered on the individual and small group market, both on and off the state-sponsored exchange, Access Health CT. Those plans cover approximately 222,700 residents.
Meanwhile, state Senate Republican Leader Kevin Kelly (R-Stratford) and Sen. Tony Hwang (R-Fairfield), ranking member of the Insurance Committee, issued a statement saying the reduced increases will still cost consumers too much.
“Connecticut is becoming more unaffordable for working and middle-class families,” they said. “It’s infuriating because it didn’t have to be this way. Connecticut Republicans have a better way to affordable health care and a comprehensive plan to rein in cost drivers and reduce premiums for all families by up to 30%. That’s a savings of over $500 per month for the average family.
“But Democrats refused to consider this plan,” they continued. “Now, instead of premiums going down, rates are going up. Democrats refused to take action to reduce the growth of industry cost drivers and to make insurance more affordable for all.
“This is unacceptable,” they concluded. “We will continue to push for action on health care reform. All people deserve affordable, quality care.”
But the criticism wasn’t limited to Republicans. State Attorney General William Tong said the increases “will be one more strain on Connecticut families and small businesses at a tremendously challenging time. While I recognize that the Connecticut Insurance Department did not give insurers all that they asked for, these rate hikes are still far too high. I am not convinced that any increase was warranted based on trends we are seeing in our own state and nationwide.
“We need to take a hard look at how we scrutinize and approve these rate increases year after year because status quo is simply not affordable for Connecticut families and businesses,” Tong continued.
“Over the years, and during the informational hearing, health insurers lamented the ever-increasing costs of medical care as a primary driver of premium rate increases. Yet, as in the past, the insurers have not been required to demonstrate why they, as the primary negotiators of provider contracts, continue to fail to hold the line against ever increasing medical and pharmacy fees.
“They need to do better in this critical role and the insurance department’s rate review has to begin to hold them more accountable in the future,” Tong said.