State regulators have ratcheted down the premium increases sought by the Vermont’s largest private health insurer, but one key official says rate hikes for next year’s plans will still be “ridiculously high.”
Blue Cross Blue Shield of Vermont had asked for a 12.6 percent premium increase, on average, for the various plans it sells in Vermont. On Thursday, the Green Mountain Care Board ruled that Blue Cross will instead have to make do with a 9.2 percent increase.
Kevin Mullin, chairman of the five-person board, says Blue Cross projected higher cost trends than are likely to transpire next year. He also says the company was asking to contribute more than is necessary to reserves.
But Mullin says the 9.2 percent figure, while lower than what Blue Cross had asked for, is “still ridiculously high.”
“There’s nothing to be too happy about with this filing,” Mullin says. “It really isn’t a win for somebody that’s struggling to get by, paycheck to paycheck, to pay an increase of 9.2 percent.”
Sara Teachout, director of public relations for Blue Cross, says the insurer “accepts” the board’s decision.
“But we are concerned that the 9.2 percent may not be sufficient to fund the health care needs of our members,” Teachout says.
Mullin says the board’s push to lower rates as much as possible was driven by a desire to keep insurance plans as affordable as possible for Blue Cross’ approximately 70,000 policyholders in Vermont.
Teachout, however, says if costs next year are on par with Blue Cross estimates, then it will need to raise rates in 2019 in order to recoup losses.
“Under-funding premium rates really isn’t cost containment,” Teachout says. “If the rates aren’t sufficient to fund the health care needs of our members, it’s going to be a problem in the future.”
On Wednesday, the Green Mountain Care Board issued a decision in the rate filing by MVP, the other private insurer selling health plans in Vermont. MVP has asked for a 6.7 average premium increase; the board cut that figure nearly in half, said it would be allowed to raise rates by only 3.5 percent.
Mullin says the discrepancy between increases for the two insurers puts the New-York based MVP, which has about 10,000 policyholders in Vermont, in a strong position to pick up market share.
“I do worry also that, based on the filings, that our Vermont company is going to lose some of their market share,” Mullin says.