Insurance Division Approves 14.3 Percent Regence Rate Increase
State regulators scaled back several requests in recent months though insurance rates still skyrocket
January 5, 2011 -- The Oregon Insurance Division has approved a 14.3 percent average rate increase affecting nearly 70,000 people with Regence BlueCross BlueShield individual health insurance renewing after February 1.
Regence had asked state regulators for a 22.7 percent average increase to take effect in October. But because of negotiations between Regence and state officials a decision was delayed, according to Cheryl Martinis, insurance division spokeswoman.
“Overall, we estimate the impact of changes due to federal healthcare reform at 3.5 percent of the overall 14.3 percent increase,” Martinis said, adding that families with children up to 24-years-old will see “higher rate increases than others because of the federal reform that guarantees coverage for children under age 19.”
The Division originally reduced the average increase to 18.9 percent on premiums to take effect in October, but because the decision was delayed until now, the increase will only be 14.3 percent this year.
In comments posted on the Division’s website, consumers voiced their complaints. “With our coverage at a minimum and our rates at a maximum, it almost seems like a cruel joke that another rate increase is already in the works,” wrote S Anderson from Portland.
The decision follows prior average increases on Regence individual plan holders of 17.1 percent in 2009, 24.1 percent in 2008 and 17.6 percent in 2007.
Last year Regence reduced benefits and re-branded its individual products as Regence Evolve. The company still expects a 5.8 percent loss over the next year on its individual plans, and according to the company’s latest filing, it expects to spend more than 19 percent on administrative costs.
Overall Regence remains in strong financial shape, having earned more than $70 million in net income from Jan 1 – Sept 30, 2010.
Considering its individual line of business separately, Regence lost $11.7 million in 2009, said Martinis, and $93.8 million on individual plans from 2006 to 2009, said Samantha Meese, Regence spokeswoman.
“Unfortunately, the rate approved by DCBS is not enough to cover the anticipated needs of our individual members based on the most recent experience of this pool and the anticipated impact of federal health reform,” Meese said.
The decision also follows several rate hike requests that the Insurance Division scaled back somewhat in recent months. HealthNet, Providence and ODS Health Plans all had individual increases reduced by 2 to 5 percent. Regence had its small business rate increase lowered by 2 percent. Those rate increases nonetheless averaged from 8 to 18 percent.
The Oregon Insurance Division regulates small group and individual health plan rates covering nearly 500,000 Oregonians, about 13 percent of the state’s insured.
Leaders at the Division were armed in 2010 with new provisions in state law as well as $1 million from the federal government to strengthen rate regulation. As part of those funds, OSPIRG received $100,000 to provide consumer input. In the group’s first analysis it found United Healthcare failed to justify a 16.8 percent average increase on small group plans. The Division has yet to rule on the case.
“It’s definitely great to see the Insurance Division scaling the rate hikes back a bit,” said Laura Etherton, health care advocate for OSPIRG. “In any economy these double-digit rate increases are too much for families and small business to afford. Whether it’s a 25 percent or 18 percent, it’s still going to be really challenging for business and consumers to swallow that kind of increase.”
The following were taken from the Insurance Division’s public comment forum on the proposed 22.7 percent average increase on Regence individual health plans before the Division reduced the increase to 14.3 percent.
Submitted by A M from Klamath Falls
This is clearly out of line. I am 60 years old and am terrified that before I reach Medicare age I will be forced to drop my individual policy because of premiums. If this increase is approved my monthly premium will jump to $640.00. This equates to $7,680.00 annually which is 31% of my gross income. This is on top of a $1,500.00 deductible with a 30% co-pay for services. Do the math.
Submitted by S Anderson from Portland
After recently being subject to a 215 dollar per month increase in our family's premium upon our renewal in July, and having to raise our deductible from 2500 to 7500 in order to be able to afford the new premiums, I received notification of this Regence rate increase request. With our coverage at a minimum and our rates at a maximum, it almost seems like a cruel joke that another rate increase is already in the works. It is incomprehensible that these increases continue to be approved. Where is the consumer protection?
Submitted by J Olivia from Portland
Please do not allow this rate increase. My rates have gone up almost 50% and my coverage has been drastically cut over the 3 years I've been purchasing individual insurance from BCBS (when they cancelled the adequate Blue Preferred and instituted EVOLVE, this ceased to be what I can consider adequate coverage).With rates increasing at such an alarming rate and the company providing such shoddy coverage, I have to carefully consider whether paying these bills makes financial sense. I do not want to be uninsured but I'm about done with Regence rate increases and EVOLVE, which is a disgrace.
Submitted by J McCaulley from Portland
Regence has already had a significant rate increase this year along with decreased coverages that were offered prior to the July 1,2010 changes.
Submitted by GM from Portland
It's deja vue time. I work as a substitute teacher and pay for my own individual plan -- which went up in price (16%) and down in benefits this last April. If my calendar is correct, that's less than six months ago. My $5000 deductible policy now runs me $5148 a year.
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Health Insurance is a business...and it has very little competition in Oregon. We needs to open up the market and allow all health insurance companies in the US to offer health insurance to Oregonians. We need options and you can only get that if businesses compete! We are held prisoner by the lack of choices.
Everyone knows it is volume that makes a business. Affordable rates = volume.
It not a choice when you choose not to have health insurance...no one wants that!
The news channels are reporting that "Healthy People" are dropping their health insurance and leaving the un-healthy ones insured and therefore, causing the insurance companies to lose money. This will only continue and it will become an even bigger crisis than we already have. These rates increases must stop...it's looking like the housing market all over again
Every Oregonian needs to demand that we open the market for health insurance...lets get some competition going...NOW! Write your Governor!
I'm just going to throw out an example of what is wrong here. I know a single mom who gets a $5,000 tax refund every year, which she promptly spends on cigarettes, gambling, and shopping. That same woman has the nerve to tell me how unfair it is that she can't afford insurance. Not true, I said to her - you are CHOOSING not to, because you think somebody else should do it for you.
Medical care isn't free - but it should be a priority for people. In fact, it should be a bigger priority than buying your 10 year-old a new cell phone, or driving a new car, or whatever else we all waste money on. We have to get more of the healthy people into the pool or rates will not go down. Doctors and hospitals are not free - they're very expensive, and insurance companies are taking in less in premium for Individual products than they are paying out in the way of medical claims. If you want to do something about it, call people on their behaviors and their choices that are costing all of us a lot of money.
My husband had back pain for a month. It wasn't until he fell when he agreed to go to the ER. He was diagnosed with cancer and is now paralyzed, can no longer work and is on disability. He is on Medicaid. His medical bills are over a million dollars. If we were able to go to a doctor sooner (without fear of losing absolutely everything and the fear of being ill and vulnerable and on the street after losing everything) he wouldn't be disabled and his bills wouldn't have been so high. Does this make any financial sense?
Even if we had insurance we could not afford copays on a million plus dollars. I don't know anyone who can afford them. He was hospitalized 14 times and had so many doctor visits I cannot begin to count them. The ONLY one who beneifits are the insurance companies.
Usually when someone is so ill you also lose income so you can no longer afford to pay for your insurance policies. Health insurance policies are like a term life policy---once you reach a certain point you lose it. You can pay for premiums for years but once you are ill and unable to pay, you lose it.
Wake up America. Don't stress about it, stop paying unecessary insurance premiums. Get sick, get yourself on Medicaid and then and only then will our government find a solution to the problem.
Once again - the finger is pointed the wrong direction. Premiums are astronomically high and yet insurance companies are actually taking a loss on covering individuals. Does this mean they're supposed to be a charitable organization? Where does the money come from to pay for over - the - top medical expenses? If there were no insurance companies and individuals were paying directly for their care they may start directing their complaints in the right direction. Why is the cost of care so high?
The healtcare system is indeed a mess. If the average citizen is to be able to afford coverate, society and government must find a meaningful way to address spiraling medical and drug claims costs which make up the bulk of insurance rate increases. Something is out of whack when Americans have to go to Canada and Mexico to get their medications as at a fraction of USA cost. Is society really willing to pay for all forms of medical treatment regardless of cost? If yes, it is expensive and who pays? If no, the needs of the many to have affordable health care supercedes the needs of the few. Unlimited healthcare is like a big checkbook. I can't keep writing checks if I don't have the money in the bank.
How about instead of increasing premiums so high that people with existing conditions can no longer afford insurance, we charge per individual premiums on children? How does it make sense that a family with one child pays the same premiums for one child, as a family with ten children? It doesn't.
Cheer up, you folks who are paying $600 or $700 a month. My wife and I both lost our full-time jobs, and we are paying $1565 a month for health insurance. (It went up from $1102 to $1565 in December -- Merry Christmas.) We are in our 60s and she has pre-esisting conditions, so we can't find a cheaper policy. Every cent of our savings will be gone by the time we reach Medicare age. A cruel joke, indeed.
C. Sparks