By Jenna Carlesso / CTMirror.org

Insurance companies that sell policies on and off Connecticut’s Affordable Care Act exchange stunned advocates in July when they asked for an average increase of 20.4 percent on next year’s individual health plans.

The proposed rate hikes, published by the state’s Insurance Department last month, also include a recommended increase of 14.8 percent on small group health plans.

The requests are substantially higher than what insurers sought last year for 2022 health policies. Carriers in 2021 asked for an average hike of 8.6 percent on individual plans and 12.9 percent on small group plans.

“It’s jaw dropping,” Lynne Ide, program lead for communications outreach and engagement at the Universal Health Care Foundation of Connecticut, said last month. “Looking at these rate requests, the ranges are off the charts.

“Our big concern right now is, coupled with inflation and the fallout from COVID, these proposed increases spell trouble. Our concern is that people will take a look at this and decide to go without health coverage, because they just can’t afford it.”

The Insurance Department is weighing the requests and is expected to issue a decision in September. Before that happens, the public will have a chanceto make comments on the suggested rate hikes.

The insurance department has scheduled a public hearing for Monday, Aug. 15, beginning at 9 a.m. at the Legislative Office Building, 300 Capital Ave. in Hartford.

The public can testify. Sign up for in-person testimony opens at 8:30 a.m. at the Legislative Office Building on the day of the hearing. Cutoff to sign up for virtual testimony was Friday, Aug. 12.

Public comments also can be filed via this portal on the Insurance Department’s website, and the hearing will be broadcast / live-streamed by CT-N.

Representatives of the insurance companies will be allotted time to explain their rate hike requests, and officials from the insurance department can ask questions. 

How much do insurers want?

Three insurers are selling policies on Connecticut’s exchange: Anthem Health Plans, CTCare Benefits Inc. and ConnectiCare Insurance Co.

Anthem requested an average increase of 8.6 percent for individual policies that cover 27,698 people. The proposed changes range from a decrease of 1.8 percent to an increase of 16.1 percent, depending on the plan.

The company also sought an average hike of 3.6 percent on small group policies that cover 19,271 residents. The suggested changes range from a decrease of 1.2 percent to an increase of 26.3 percent.

CTCare Benefits asked for an average hike of 24.1 percent on individual plans that cover 75,003 people. Proposed changes range from an increase of 18.7 to 33.2 percent, depending on the policy. 

It also sought an average hike of 22.9 percent on small group plans that cover 3,476 residents (increases range from 20 to 28.9 percent).

ConnectiCare, which only sells individual policies on the exchange, requested an average increase of 25.2 percent for plans that cover 8,782 people. Suggested hikes range from 17.1 to 32.2 percent.

A complete list of plans on and off the exchange, along with rate hike requests, can be found here.

What is the justification for rate hikes?

Kimberly Kann, a spokeswoman for ConnectiCare, said medical and pharmaceutical costs were two of the factors driving the company’s requested rate increase.

“Our proposed rates are based on several factors, including medical and pharmacy cost trends, along with the continued impacts of COVID-19 on our members’ utilization of services, including obtaining delayed care,” she said. 

“Also, the legislative and regulatory environments continue to present market challenges outside of the company’s control, including the loss of the enhanced Advanced Premium Tax Credits provided through the American Rescue Plan Act set to expire in 2022, and state-mandated benefits.”

Alessandra Simkin, a spokeswoman for Anthem, said: “Our filing reflects our experience and ability to deliver on behalf of consumers in this market and we look forward to working with the state as we continue the regulatory process.”

The insurers will send representatives to a public hearing in August, where they will be questioned about the proposed increases in greater detail.

What happens next?

Actuaries with the Insurance Department will review the requested increases. As part of the review, they will look at trends in unit cost (total expenditure incurred by the company), utilization of services, and expected severity of claims. The department will issue questions to the insurers and seek clarification if needed. It will also hold a public hearing to get input from the carriers, health care advocates and the public.

After the review, the department can approve the full requested increase, reject it or amend it to a different number. The final changes are expected to be published in late August or early September.

Do rate increases always win approval?

No. Last year, for example, the Insurance Department approved an average rate increase of 5.6 percent for 2022 individual health plans, even though the carriers had requested 8.6 percent.

The department authorized an average rate hike of 6.7 percent for small group policies, even though insurers had asked for 12.9 percent.

In 2020, Anthem Health Plans had asked for a 9.9 percent average increase in its individual plans, which served 22,071 people through the exchange. The insurance department approved an increase of 1.9 percent.

The same year, ConnectiCare Benefits Inc. sought an average hike of 5.5 percent in its individual plans on the exchange, which at the time covered 75,174 customers. The Insurance Department signed off on a decrease of 0.1 percent.

What has reaction been like?

Health care advocates have criticized the proposed increases, saying they fear more people will go without coverage because prices are too high.

“My jaw hit the floor, obviously,” Ted Doolittle, the state’s health care advocate, has said. “I’m deeply concerned that people will go without coverage because of these high prices. It is incumbent on the insurance companies and the providers to explain to the people in the state why this is inevitable and there is no alternative.”

Ide, from the Universal Health Care Foundation of Connecticut, said the proposed increases “don’t seem to make any sense.”

“Why one carrier would be asking for 8.6 percent in the individual market on average, and 3.6 percent in the small group market, and the other carrier is asking for a 24 percent and 22 percent in those two markets — it looks like they pulled the numbers out of a hat,” she said.

State Attorney General William Tong asked for a special hearing that would allow officials to collect evidence and scrupulously question insurers about their proposed increases. Officials would be able to cross-examine witnesses and present their own evidence in a public setting.

The Insurance Department did not agree to the formal hearing.

“Health care costs and insurance premiums are already unaffordable for many Connecticut families, businesses and individuals, and these double-digit rate hikes demand rigorous scrutiny,” Tong said.

When does open enrollment start?

Open enrollment for 2023 health policies begins Nov. 1.