Big North Carolina Obamacare insurer reduces rate-hike request, citing lower-than-expected medical costs

North Carolina’s biggest Obamacare insurer on Wednesday sharply cut its request to raise health plan prices next year, asking regulators for a 14.1 percent average hike instead of its original 22.9 percent request.

Blue Cross Blue Shield of North Carolina said the lower requested rate for monthly premiums reflected the fact that it recently has “gotten a better handle” on expected medical costs from its individual health plan customers, making it easier to estimate necessary prices for 2018.

But Blue Cross Blue Shield’s new rate-hike request is still 5.3 percentage points higher than it otherwise would have been if the Trump administration guaranteed insurers key federal payments that the administration repeatedly has threatened to end.

Blue Cross Blue Shield covers about 500,000 Obamacare customers in North Carolina. Its original rate request for 2018 plans was made in late May.

Since then, the insurer said in a statement posted on its website Thursday, “The individual market in North Carolina has become less volatile.”

“Put simply, we got information in June and July that made us confident we could reduce our requested rate increase for 2018,” wrote Brian Tajlili, the insurer’s director of actuarial and pricing services.

Tajlili noted that Blue Cross Blue Shield adjusted its rate increases in each of the past three years “to take into account additional claims experience or new developments.”

“In a few of those years, the adjustment increased our rate request. This time, the adjustment is to reduce our request,” he wrote.

Tajliili said the insurer believed the new 14.1 percent request “will allow our [Obamacare] plans to be financially viable while being more affordable for our customers.”

But, he added, “there is still a great deal of uncertainty surrounding the law. Many customers, particularly those not receiving Federal subsidies, will face challenges affording any premium increase.”

The federal government currently reimburses Blue Cross Blue Shield and all other Obamacare insurers billions of dollars for discounts that the insurers are legally bound to give low- and middle-income Obamacare customers for their out-of-pocket health costs.

The Trump administration has threatened to end those payments. Experts have said the refusal of the administration and the Republican leadership of Congress to guarantee the payments could add 20 percent or more to premium price-hike requests for next year.

SOURCE:https://www.cnbc.com/2017/08/02/big-north-carolina-obamacare-insurer-reduces-rate-hike-request.html

383 thoughts on “Big North Carolina Obamacare insurer reduces rate-hike request, citing lower-than-expected medical costs”

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