State regulators scaled back several requests in recent months though insurance rates still skyrocket
EDITOR'S NOTE: This story was changed from it's original after an error made by the Oregon Insurance Division that calculated the average increase as 18.9 percent.
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.
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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