Affordable Care Act Premium Increases: New York Insurers Request Double-Digit Higher Premiums for 2015
With the Affordable Care Act (ACA) in effect in New York, insurance companies are expected to request double-digit premium hikes for 2015. The average increase is 12 or 13 percent, but Business Insider noted that the bigger insurers on the state health care exchange are requesting higher premium increases.
The health insurance companies have asked for the increases for various reasons, such as to cover more sick customers than initially projected, medical costs, taxes and government regulations. In 2013, the insurers asked for a 9.5 percent increase on insurance premiums, but the New York Department of Financial Services approved a 4.5 percent hike instead.
Capital New York noted that nonprofit insurer Health Republic Insurance of New York is asking for an average premium increase of 15.2 percent for its individual health exchange plans. Health Republic is the most popular insurer on the state's health exchange, with 40 percent of the total enrollment, or 68,000 customers.
The second most popular insurer on the state's health exchange is Fidelis, which has asked for a 7.1 percent increase for its premiums in 2015. Fidelis said its customers are older and more likely to get sick than are younger consumers.
"We assumed that membership would reflect the population in existing plans," Fidelis told the Department of Financial Services. "In fact, the population that entered the Individual market with Fidelis and with other carriers is older than anticipated. The older population alone would require a 17 [percent] rate increase."
Meanwhile, MetroPlus requested an average 18.5 percent increase for next year, which would increase some customers' premiums more than $100. A platinum plan from MetroPlus would increase from $457 to $585 per month if the increase were approved. MetroPlus services New York City residents only and is the third most popular insurer on the state's exchange.
UnitedHealthCare spokeswoman Maria Gordon Shydlo, via the New York Post, said insurers are increasing their pricing to "match expected medical spending," which ranges from medical costs and utilization to mandated coverage and other expenses.
Department of Financial Services Superintendent Ben Lawsky told the New York Post, "We are going to scrutinize these rate requests very closely in order to protect New Yorkers and ensure they are not subject to any unjustified rate increases."
DFS has the final word on premium hikes.
Insurer often request or implement price increases for premiums annually. For 2015, the proposed increases are "markedly higher" than average. But a rate hike of 12 percent isn't so bad compared to Arizona-based insurer Humana's requested rate hike of 25.5 percent.
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