Maryland’s dominant insurance company, CareFirst, is proposing hefty premium increases of 23 to 30 percent for consumers buying individual plans next year under the federal health-care law, according to filings released Friday.
The rate proposals by CareFirst and several other carriers were posted on the Web site of the Maryland Insurance Administration and paint a mixed picture. Two other insurers, Kaiser Foundation Health Plan and Evergreen Health Cooperative, are proposing to lower rates for next year, by 12 percent and about 10 percent, respectively. And two new carriers — Cigna and United Healthcare — are offering plans for the first time in the state’s individual market, which serves about 200,000 of Maryland’s nearly 6 million residents.
The proposals do not affect health insurance plans that provide coverage for most Marylanders, such as those offered by large employers or employers who self-insure. Nor do they apply to “grandfathered” plans that were bought before March 2010 or federal plans such as Medicare, Tricare and federal employee plans.
The Maryland Insurance Administration will review the plans and can ask insurers to lower them before approving final rates. Last year, CareFirst proposed a 25 percent rate increase but regulators cut the final rates by 10 percent. Maryland’s rates in 2014 were among the lowest in the country, analysts have said.
Policy analysts are looking at the 2015 rates to determine how insurers are adjusting after the first enrollment period under the Affordable Care Act. The 2010 law bars insurers from charging consumers higher premiums based on their medical conditions or gender. Premiums can vary by age and whether someone smokes. All insurers are required to offer a package of essential benefits and follow stricter rules for how much covered individuals are required to pay out-of-pocket.
Analysts have said that large premium increases could reflect the fact that insurers got a sicker-than-expected mix of patients during the first enrollment period; a rate cut, on the other hand, could be for competitive reasons or the result of a better-than-expected mix of patients. Twelve states have posted rates for 2015, including Virginia, Arizona, Connecticut and Washington. In Virginia, insurers are seeking rate increases ranging from 3.3 percent to 14.9 percent in the individual market. In Washington state, insurers have proposed rates ranging from a 6.8 percent decrease to a 26 percent increase.
In a statement, CareFirst CEO Chet Burrell said:
“It is impossible to understand from the consumers’ point of view what they will pay without knowing how the actual premium rates compare. It is unfortunate that this information has not been made available by the MIA. We believe when rates are compared, CareFirst’s rates will be competitive and consumers will better understand what their actual choices are.”
Kaiser said its 2015 rates reflect the value of its integrated delivery system and the expectation that more people will be signing up for its plans. “We believe consumers can have affordable and top-rated care all in one plan, with low copays, more covered services and fewer hidden fees and surprises,” Kaiser said in a statement.
Evergreen’s chief executive, Peter Beilenson, said its proposed rates would make the cooperative even more competitive. Enrollment has been extremely active in the past few months, he said. “These rates, if approved, would clearly increase our momentum. We expect a very strong close to 2014, and an even stronger 2015.”
Joshua Sharfstein, Maryland’s health secretary, said, “We’re clearly seeing competition between the carriers emerging.” He added that the continuing troubles of the flawed state exchange — Maryland Health Connection — did not affect the carriers’ rate requests.
Connecticut, which has been praised for its health insurance marketplace and is helping Maryland rebuild its exchange, has seen two carriers propose rate increases averaging about 12 percent and a third propose a decrease of nearly 9 percent.
Insurance plans sold on exchanges are categorized as bronze, silver, gold or platinum based on how costs are shared. Bronze plans tend to have lower premiums but higher out-of-pocket costs, such as deductibles, co-pays and co-insurance.
Based on information provided by the Maryland Insurance Administration, for the lowest proposed bronze plans, a 40-year-old nonsmoker in the Baltimore area would pay $178.90 under the Kaiser Foundation Health Plan; $180.42 under Evergreen; $185.30 under CareFirst’s BlueChoice plan; and $318.72 under the All Savers Insurance plan.
According to publicly available data, the same 40-year-old nonsmoker in Fairfield County, Conn., would pay $268.24 to $368.29 under proposed rates for bronze plans.