By Katie Kerwin McCrimmon
Consumer advocates say careful rate review will save Coloradans millions on health insurance next year, but they warned people to shop around and ask questions as they renew old plans or hunt for new ones starting next month.
For example, rate experts from the Colorado Consumer Health Initiative protested a proposed increase of 19 percent between 2014 and 2015 rates on a policy from Anthem Blue Cross and Blue Shield of Colorado that could affect about 21,000 consumers. State regulators questioned the hike and ultimately approved an increase of 13.9 percent year over year. While that hike is higher than increases on many other policies in Colorado from 2014 to 2015, advocates say the 5 percent savings would amount to about $4.7 million if all customers renewed — or about $220 per year for each policyholder.
“In Colorado we’ve been using rate review pretty effectively to save consumers well over $100 million over the past five or six years,” said Adam Fox, director of strategic engagement for the Colorado Consumer Health Initiative.
The Anthem policy is one of the so-called “non-compliant” pre-Affordable Care Act plans. All of these were supposed to be defunct once health reform went into full effect at the start of this year. But facing criticism from people who were losing their plans, President Obama decided to allow customers to keep non-compliant plans as reforms go into effect.
In Colorado, consumers can keep their old plans through 2015 if their insurance company opts to continue selling the plan.
Fox urged consumers to be very cautious before renewing plans. They should not assume that old plans are a better deal. Rates can go up on old plans and they don’t have to include the full menu of benefits now required on new plans that are sold through Colorado’s exchange, Connect for Health Colorado.
“Especially because so much has changed, it’s important to look at your options. You might find something that’s more affordable or better quality,” Fox said.
Anthem spokeswoman Joyzelle Davis said in a written statement that rate setting often requires a back-and-forth dialogue between state regulators and insurance carriers.
“Our rate adjustment on this plan came after working closely with our regulator. One of the factors that goes into our rate filings is past claims experience, and the additional time the (Division of Insurance) gave us to respond to the division’s comments allowed additional months of data about our members’ claims to be taken into account,” Davis wrote. “We are happy that the further information supported a smaller increase for our members.”
Fox said Colorado insurance regulators have been working to beef up their rate review process and not simply rubber-stamp hefty rate hikes year after year.
Nonetheless, he said the process should be simpler so consumers won’t have to depend on health policy wonks to monitor rates for them.
“It’s encouraging that the DOI is paying close attention to these non-compliant ACA plans so consumers are not being taken advantage of,” Fox said.
The bottom line, advocates say, is that rates, and justifications for any rate hikes, must be clear and comprehensible, and consumers need an easy way to comment on and, if necessary, protest any increases that they believe are egregious.