Massive Increases in the Cost of Health Insurance Due to Obamacare Mandates

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We have already begun to feel the pernicious effects of the Obamacare legislation in many ways. Because of the regulations and mandates, many insurance plans are no longer being offered resulting in hundreds of thousands (or more) of people losing their coverage. Others, in order to remain viable, have had to precipitously increase rates 20% or more (see 47% below). This results in either very expensive or unaffordable coverage, neither which is a desired outcome.

These and many other reasons further illustrates the urgency to overturn the Obamacare legislation and divorce the federal government from controlling the system.

Anthem Approved For Health Insurance Rate Hikes As High As 47 Percent
Matthew Sturdevant     October 14, 2010

The state's largest insurer has been approved to raise health premium rates by 41 percent to 47 percent for some of its policies sold to individual buyers, in the largest price hikes yet seen in Connecticut since the adoption of national health care reform.

For all of its individual market plans, Anthem Blue Cross and Blue Shield has received approval to raise rates by at least 19 percent -- including a range of 30 percent to 44 percent for the brand of plans in the individual market that was most popular in 2009, Century Preferred.

The reason for the increases is the new federal health reform mandates, according to Anthem and the state Department of Insurance, which is defending its approval against charges by Attorney General Richard Blumenthal. Those reforms took effect Sept. 23.

In all, the Anthem individual plans were in use by 55,536 people in the state as of April 2009, the latest figures available, according to Insurance Department documents. The rate requests were approved without change last month by the Insurance Department.

The rate hikes "deeply disappointed" Blumenthal, who wrote an Oct. 6 letter to Insurance Commissioner Thomas Sullivan saying the increases were approved without detailed scrutiny or consideration of whether they are "excessive."

Blumenthal did not give a breakdown of plans and prices in that letter, but documents obtained by The Courant from his department show price increases for a single male, age 40 in the range of $1,200 per year for Century Preferred plans.

"Connecticut law requires that proposed insurance rates 'shall not be excessive.'" Blumenthal wrote in the letter. "In order to determine whether rates are excessive, the Insurance Department must review of all aspects of the insurance policy, including medical trends since the last rate increase, expenses and profits, how much of the expenses are administrative, and the impact on potential policyholders. As explained below, the Insurance Department failed to review any of these factors."

The letter takes aim at proposed rates approved in September for Anthem and Aetna. Blumenthal asks Sullivan to reconsider the rates. Sullivan has responded by saying the rates include "very rich benefits" required by federal law.

"There is not one person in the state of Connecticut who will see an increase in their current premiums based on what the department approved for Anthem and Aetna," Sullivan said last week in response to Blumenthal's letter. "The rates that were filed and approved reflect the current cost to deliver care and the impact of more comprehensive benefit designs required under the federal healthcare reform law. If the attorney general wants to complain to someone, he should be complaining to Congress.

Anthem would not say how many people are in each plan.

It is not clear how many people are paying, or will pay, these new rates because federal reform allows insurers to grandfather certain plans that existed before reform was passed in March. What it means for Anthem customers is that anyone who enrolled before March 24 will have the option of staying in their current plan, which would increase next year based on rising costs but not because the plan will have added benefits mandated by federal law. Anyone who bought an Anthem plan on March 24 or later will pay the new rates.

In terms of higher rates, Anthem spokeswoman Sarah Yeager attributed the rising price to robust new benefits which the plans hadn't offered before federal reform.

"Our [Patient Protection and Affordable Care Act] compliant individual products include expanded benefits such as elimination of lifetime dollar maximums, no cost share for preventive coverage, and extension of dependent coverage to age 26. With this enhanced coverage, pricing levels have also been adjusted to make sure that the cost of claims incurred is offset by the premiums collected, and that we anticipate the cost of future, expected claims. Low cost low benefit plans experienced a higher rate adjustment because with the health care reform provisions the plans now offer richer benefits. Other plans that already offered rich benefits did not experience as much of an adjustment."

http://blogs.courant.com/connecticut_insurance/2010/10/anthem-approved-for-health-ins.html

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