The Connecticut Insurance Department will hold public hearings July 27 on proposals by three insurance companies to raise rates on health plans for 2016.
Altogether, the plans offered by Anthem Blue Cross and Blue Shield, ConnectiCare and Golden Rule Insurance Company cover 70,553 policyholders who purchased insurance for themselves through the state’s individual insurance market.
Some of the Anthem plans subject to the hearing are sold through the state’s health insurance exchange, Access Health CT, while all the ConnectiCare and Golden Rule proposals that will be reviewed during the hearings are sold outside the exchange.
Anthem is seeking to raise rates by an average of 4.9 percent for its plans, which have 34,553 policyholders in the state. ConnectiCare is seeking a 9.8 percent increase to plans with 34,000 policyholders, while Golden Rule proposed an 18.5 percent rate hike for plans that cover 2,000 policies. Anthem and ConnectiCare initially proposed different average increases but adjusted them after Access Health raised the fee it charges insurance plans to fund its operations.
Insurance Commissioner Katharine L. Wade ordered the hearing after consulting with state Healthcare Advocate Victoria Veltri about which plans should be subject to it.
“I believe it is very important that consumers better understand the regulatory review process and the factors that drive health care costs that ultimately have an effect on their household budgets,” Wade said in a statement. “The Department’s actuarial review is rigorous and seeks to ensure that rates are adequate for the benefits offered and protects consumers’ interests.”
Veltri said they chose Anthem and ConnectiCare because they have the most customers in the state’s individual market and on the state’s health insurance exchange, including some who are new to coverage. “We felt it was necessary that people have a say in those,” she said.
Golden Rule, meanwhile, was picked because of the size of its proposed increase, Veltri said.
Anthem spokeswoman Sarah Yeager said transparency is important to the company. “As always, we will cooperate fully throughout the rate filing process and welcome the opportunity in any forum to ensure that all stakeholders have the information they need to understand the factors that support our proposed rates,” she said.
ConnectiCare said in a statement that the company “welcomes the opportunity to review its rate filings with the Connecticut Insurance Department and the general public.”
The hearings will be held Monday, July 27, at the Connecticut Insurance Department, 153 Market St., Hartford, on the 7th floor. The ConnectiCare hearing will run from 9 a.m. to 11 a.m., Golden Rule’s hearing will run from 11 a.m. to 1 p.m., and Anthem’s hearing will be held from 1 p.m. to 3 p.m.
People can submit written comments electronically at www.ct.gov/cid.
Past controversies over rate hearings
In the past, the role of rate hearings has been a subject of intense debate between consumer advocates – who have sought more frequent hearings on proposals to raise insurance rates – and insurance department officials, who have maintained that they make decisions about rates based on actuarial factors.
In 2011, Gov. Dannel P. Malloy vetoed a bill that would have made it easier for the healthcare advocate and attorney general to compel public “symposiums” on proposed rate hikes. Soon after, Veltri and then-Insurance Commissioner Thomas B. Leonardi reached an agreement that allowed her to request hearings on proposals to raise rates by 15 percent or more.
Last year, the insurance department held a hearing on Anthem’s request to raise rates on close to 66,200 policies – the first rate hearing in nearly four years. The regulator ultimately rejected the insurer’s request to raise rates by an average of 12.5 percent and approved a smaller increase. But in the decision, Paul Lombardo, the actuary who oversaw the hearing and reviewed the proposal, included comments critical of the value of hearings in determining the price of insurance.
In the decision, Lombardo noted that state law allows rates to be rejected for three reasons: if they’re inadequate, excessive or unfairly discriminatory. And he wrote that the department’s usual process for reviewing rate proposals allowed for more flexibility and deliberation, at less cost than holding public hearings.
But Veltri has maintained that hearings are valuable in giving people confidence in the process used to evaluate rates.
“I think the public often will see a rate increase and say, ‘Why are they doing this to me?’ and there could be a valid reason in some cases,” she said. “The hearing does give an opportunity for the plans to justify what they put in.”
Veltri said Tuesday that she and Wade have reached a new agreement on rate hearings. Wade agreed to hold hearings at the healthcare advocate’s request up to four times per year on proposals to raise rates by 10 percent or more — a lower threshold than under the previous agreement.
The agreement also notes that the insurance commissioner plans to host a series of public forums throughout the state to help educate people about the factors driving health insurance rates and health care costs, and to allow people to give feedback about their experiences with health insurance.