Pennsylvania’s Obamacare insurers have lowered their average 2019 rate request from 4.9 percent to nearly 1 percent, the state’s insurance regulator said Monday.
Back in June, the state’s insurers on Obamacare’s insurance marketplace asked for a 4.9 percent increase. However, the state said Monday that insurers lowered their requested rates due to a series of factors.
After considering their experience in 2018, “including lower insurer expenses for cost-sharing reduction payments covering deductibles, co-payments, and co-insurance for lower income customers, the department lowered the amount of a standardized factor,” the state said in a release.
“Additionally, some carriers made minor changes to assumptions in their filings following input from the Insurance Department during the department’s review process.”
The rates still must be finalized by the state before open enrollment for 2019 starts this fall and so they could change.
Insurance Commissioner Jessica Altman said that she doesn’t expect a recent decision by the Trump administration to freeze risk adjustment payments to have an impact on rates. The risk adjustment program requires an insurer that reaches a certain threshold of profits to pay the federal government money that then goes to help insurers with heavy losses.
The Trump administration paused the payments earlier this month in response to a February court ruling that found problems with the formula that calculates the payments.
But Altman said the department doesn’t anticipate the decision “will have an impact on the state’s current rate filing process, and the department has not received any indication that the carriers plan to significantly change their rates or participation as a result of the suspension.”
Pennsylvania’s insurance department credited in part an effort from the state’s Democratic Gov. Tom Wolf to boost outreach efforts after the administration cut funding for outreach by 90 percent last year.
The state’s proposed rate hike is far lower than several other states.
For instance, one plan in Maryland called for an increase of up to 91 percent. Connecticut Obamacare insurers recently proposed an average 12.3 percent hike, and New York insurers asked for a 24 percent boost.
Insurers frequently cited the zeroing out of the financial penalty for Obamacare’s individual mandate starting in 2019 as a factor in the premium hikes. The mandate requires that everyone buy insurance, and insurers are worried that younger and healthier people won’t buy insurance without the mandate, making the insured population sicker and more expensive.
