Insurance Premium Regulators Step In

insurance premium

This time of year health insurance carriers submit their insurance premium rates for 2016 to regulators for approval. With healthcare premiums already rising it was a surprise to see Florida regulators telling some carriers to raise their requested premium increase. Both Human and Blue Cross & Blue Shield of Florida were among those whose final rates were higher than they’d first filed, reports Bloomberg Business. Alex Kepnes, a Humana spokesman said the approved increase incorporated updated information from the U.S. Government on ACA programs designed to spread cost, known as reinsurance and risk adjustments.

Regulators are able to push insurance to raise their prices or to lower their premium depending on what the carrier requested. Typically when rates are submitted the regulators request that a carrier lowers the cost, but not increase it. The Florida Division of Insurance (DOI) believed that the requested rate increase proposed by Blue Cross & Blue Shield of Florida and Humana weren’t enough to cover costs. Humana asked for a 7.4 percent increase, but the Florida Office of Insurance Regulation told them to increase rates 16.3 percent instead.  Blue Cross & Blue Shields rate increase is 8.9 percent which is double their 4.3 percent increase requested.

The Florida DOI is there to protect carriers as carriers now hold much more risk as they are insuring all Americans both the sick and well alike. The regulators are also there to protect consumers as Florida also told Aetna to lower their rate increase from 21 percent down to 13.9. Rates are averages rated by 2015 enrollment says Bloomberg Business and Florida wasn’t the only state to see requests to increase the rate rather than lower.

What are your thoughts on the regulators asking companies to raise their proposed insurance rate increase? Do you think the regulators are being fair in these decisions?

Read the full article on Bloomberg Business HERE

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