Look for health plans to request higher rates for 2016, a Blue Cross and Blue Shield Association (BCBSA) executive warned May 13.
Costs for health plans in 2014 were higher than expected due to fewer young enrollees signing up for Affordable Care Act plans during the first year that the major provisions of the law took effect requiring people to have coverage or pay a fine, Kim Holland, BCBSA director for state affairs, said at a conference on ACA health insurance exchanges.
That left health plans sold on the ACA exchanges with a high portion of enrollees who had previously unmet medical needs, such as costly transplants, Holland said. “Those plan costs were higher and those are expected to play out in higher rates,” she said. “We’re starting to see that now as plan filings are becoming public, and that is likely to continue.”
Moreover, she added, it’s unlikely that plans will receive much of the money they had expected from the ACA’s risk corridors program, which was intended to help cover insurers’ losses in the event they ended up with a sicker-than-average population. Too many plans had to cover high medical bills, leaving too few plans to pay into the fund for the program, she said.
Holland also warned that there are “unrealistic pressures” on insurers to keep premiums down. “You cannot have every doctor in your network, very low copays, broad benefits and lower costs. It just can’t work that way,” she said.
There is “a big push” in state legislatures to expand benefits and “great pressure” to limit techniques used by insurers and pharmacy benefit managers to manage costs, while at the same time there is public pressure to keep rates down, she said. “That contributes to concerns about solvency.”
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