Wednesday, September 28, 2011
Insurance Department Reduces Anthem’s Rate Hike
By Arielle Levin Beckerwww.ctmirror.org
The Connecticut Insurance Department has turned down a request by the state’s largest health insurer to raise premiums by 12.9 percent for more than 25,000 individual-market policies, instead granting the company a 3.9 percent increase.
Anthem Blue Cross and Blue Shield had said that the higher increase was needed to account for rising claims costs, increased use of services by members, and state and federally mandated benefit changes.
But the insurance department found that a smaller increase was appropriate. Actuary Paul Lombardo wrote that the lower figure was based on reducing the operating margin for the plans and removing “underwriting wear-off” from Anthem’s calculations. Underwriting wear-off refers to the decline in members’ health status since they first bought the policies, making them poorer risks.
The 3.9 percent increase could take effect Jan. 1 for about 25,000 policies covering an estimated 48,000 state residents who buy private insurance on their own rather than through their employer.
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