Alaska Health Insurance Rates to Increase Substantially
September 06, 2014
A thorough and lengthy review by the Division of Insurance shows that as a direct result of the ACA, insurers offering health plans in the individual market require historic rate increases, as high as 37 percent in 2015. Despite these increases, extensive cost and loss data show that these insurers will still incur millions of dollars in losses. “Governor Parnell has expressed concern from the beginning that Obamacare’s one-size-fits-all approach to health care for Alaskans is not going to work in our state, and that heavy-handed federal mandates, taxes, and penalties will only add to Alaska’s health care costs,” said Susan Bell, commissioner of the Department of Commerce, Community and Economic Development. “His concerns are, unfortunately, proving to be true.” The most significant increases will impact Alaskans purchasing individual insurance both in and out of the Federally Facilitated Marketplace (FFM). The hardest hit will be the approximately 6,000 Alaskans who pay for their own health insurance and do not receive federal subsidies through the exchange. Actual premiums will vary and may be higher or lower than the aggregate rate. According to a news release from the Alaska Division of Insurance. in 2013 and 2014, the Parnell administration protected Alaskans from cost increases by allowing individuals to keep health care plans that were grandfathered in, and not in compliance with the costly federal mandates, for as long as possible. “As a result of state action over the past year, Alaskans who liked their grandfathered plans were able to keep them,” said Commissioner Bell. “Until late 2016, they are able to retain their current plan, which in most cases is a less costly option than the plans offered in the federal exchange. The Division of Insurance will continue to actively seek ways to protect Alaskans from further Obamacare regulations that increase their costs.” The Division of Insurance is required by state statute and federal regulation to review insurance rates annually. “The Division of Insurance has applied a rigorous review of the rate increases requested by insurers,” said Division of Insurance Director Lori Wing-Heier. “Our staff has gone over the information with a fine tooth comb to ensure that the rates are in line with the expected claim experience in the individual market to ascertain that the insurer retains the financial ability to pay the claims." Wing-Heier said, "The division is required by state law (AS 21.54.015 and AS 21.51.405) to approve rates when the rate is justified based on the historic results of the plan, and in 2014, the results are not good. The combination of high health care utilizers and the impact of new federal mandates created a very large expense that is too big to be spread across participants without a significant increase in rates." Wing-Heier said, " In larger states, they have a large enough population to spread this expense more evenly, but in Alaska we simply don’t have that volume. The state does not have the legal authority to order an insurer to not comply with an Obamacare mandate. If an Obamacare requirement has a cost associated with it, unfortunately consumers shoulder that cost through the rates and in the individual market the data confirms that the rates need to be increased.” U.S. Senator Mark Begich (D-AK), running for reelection, stated in a news release, the Alaska Division of Insurance only included the largest increase in its announcement, not the full range of options available for Alaskans. Begich said, “After leaving millions of dollars of federal funding on the table and refusing to accept the Medicaid expansion to cover tens of thousands of Alaskans, it is frustrating to now see the State and Governor Parnell try and pass the buck on to consumers and use partisan scare tactics to confuse Alaskans about their health care.” Begich said, "This news also reinforces the need for my Copper Plan which would help increase choices and lower costs for Alaskans. Alaskans deserve better, and I will keep fighting to make sure all Alaskans have affordable access to health care.” Begich asserts the recent study by Avalere Health released by the Council for Affordable Health Coverage shows that the “Copper Plan” health insurance option proposed by Begich would lower premiums, reduce taxes and deficits, cut spending, and save American taxpayers up to $5.8 billion. The study noted the Copper Plan would also help small businesses retain their current plans and creates more choice for Americans. (A copy of the study can be found here. ) Begich noted that Alaska has not taken advantage of opportunities to invest additional resources into its rate review program and is one of only 10 states to not receive rate review funding. The Affordable Care Act makes available $250 million in grants to States to strengthen their rate review programs and bolster State authorities. Governor Parnell’s Administration has not accepted or applied for any grants for their rate review program. Specifically, noted Begich, the State of Alaska did not accept federal dollars to create its own state health care exchange, which would have provided funding for outreach and education -- missing an opportunity to bolster enrollment and provide more Alaskans with affordable health care. Also, the State has refused to expand Medicaid to Alaska’s most vulnerable families, which could help control costs, he said. Congressman Don Young (R-AK) said, “The Alaska Division of Insurance has predicted what many of us already knew was coming - massive health insurance increases in 2015, as high as 37%, for thousands of Alaskans due to Obamacare and its never-ending regulations." “A review completed by ADI ultimately concluded that federal mandates under the President’s healthcare law have created sizable expenses too large to spread across participants without dramatically raising rates," said Young. Young said, “Some will dismiss these alarming numbers as a partisan attack on the President’s healthcare law, but I assure you, for the 16,000 Alaskans paying higher rates in 2015 for the same or worse care, it’s not political, it’s painful. For the 6,000 Alaskans purchasing their own health insurance without government subsidies through the exchanges, it’s not partisan, it’s a real problem." “The House has passed several bills to repeal Obamacare as a whole or make much needed reforms to the law. I urge the Senate to consider these proposals, negotiate with us and the American people, before more people lose their doctors and healthcare to rising costs and a rising tide of Obamacare regulations, said Young.
Source of News:
|
||