HARRISBURG, Pa. (AP) – State regulators say the cost of health insurance premiums will be going up sharply next year for residents who buy individual plans.
The state Department of Insurance said Monday that insurance company rates, based on requests for 2017, include an average increase of 32.5 percent for individual plans and 7.1 percent for small group plans.
Officials said they pushed back last year on rate increase requests but, “given challenges companies are facing” and Washington’s failure to act on changes to the law, insurance company requests for rate increases next year “were critical to ensuring all Pennsylvania residents continued to have access to health plans through the federal exchange in 2017.”
Commissioner Teresa Miller said the increases were necessary to keep insurers from abandoning the market completely.
“We were trying to make a one-time correction … we hopefully got these products to a place now where they are more accurately priced,” Miller said.
The department said the rate increases apply only to about 10 percent of Pennsylvania residents who get health insurance in the individual and small group markets and not to large employers or government plans such as Medicare or Medicaid. Officials also said three out of four commonwealth residents who bought plans through the federal exchange last year were eligible for subsidies to help pay premiums.
Miller also announced that the department will seek to join Pittsburgh-based health insurer Highmark Inc. in its lawsuit against the federal government over 2014 losses over the Affordable Care Act that the company said totaled about $223 million.
The health insurer said the government failed to follow its risk corridors program, in which it promised to pay some of the losses insurers sustained during the first years of the new law.
A U.S. Department of Health and Human Services spokesman, Jonathan Gold, said most Pennsylvania consumers will be able to select a plan for less than $75 a month.
“Headline rate changes do not reflect what these consumers actually pay because tax credits reduce the cost of coverage below the sticker price and shopping helps consumers find the best deal,” Gold said.
And for the 60 percent of people with employer coverage, premiums have grown “at some of the slowest rates on record” since the health care law was enacted, he said.
(Copyright 2016 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.)