Maryland Obamacare Insurer Hiking Premiums 30 Percent

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Maryland’s beleaguered Obamacare exchange released initial premium rates for 2015 late Friday, with one insurance plan proposing a 30 percent hike.

CareFirst of Maryland Inc. and Group Hospitalization and Medical Services Inc., both CareFirst companies, submitted filings to the Maryland insurance department requesting a 30.2 percent premium increase for individual plans in 2015. CareFirst Blue Choice Inc. requested a 22.8 percent increase for next year, citing an older average membership age and a sicker patient pool.

Maryland’s exchange has only five insurers which participated in 2014 and will add another insurer in 2015. All Savers Insurance, a subsidiary of UnitedHealthcare, requested a 4.8 percent. A nonprofit Kaiser Foundation plan offered a 12.1 percent rate reduction and Evergreen Health Cooperative, 10.3 percent reduction.

The non-profit Kaiser Foundation Health Plan reported that the primary reason it opted to lower rates is the “assumed risk adjustment recoveries” for 2015. Risk adjustment provisions in Obamacare collect and redistribute payments from Obamacare insurers to those who have the sickest pool of patients. Experts believe risk adjustment measures are keeping Obamacare premiums artificially low now, but expect drastic premium hikes when two such provisions run out in 2017.

Kaiser Foundation also noted that higher patient co-payments also contributed to the decision to lower the rates.

Evergreen Health Coop is offering new products and admitted in its proposal that it does not have its own data to base the proposal on. They noted that reduced physician reimbursements, increased co-pays for primary care services, pharmacy benefits and prescription drug changes contributed to their ability to lower rates.

Maryland’s insurance commissioner Therese Goldsmith released the rate proposals Friday but made sure to remind the public that the department may not approve all increases.

“We will conduct a thorough review and may require changes to the rates before they are approved,” Goldsmith said in a statement.

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