Anthem, ConnectiCare seek premium increases for 2020 policies

Insurers that sell policies on Connecticut’s Affordable Care Act exchange, Access Heath CT, are seeking premium increases for their 2020 policies, basing their requests largely on a new federal tax that will be imposed next year.

Anthem Health Plans filed a rate request earlier this month for an average 15.2 percent increase for the health plans it sells to individuals both on and off the exchange. Those policies cover about 27,300 people, Anthem said.

“Anthem’s annual rate filing is a normal course of business,” the company said in a statement. “We look forward to working with the state and continuing the regulatory process.”

Many more Connecticut residents who seek insurance policies through Access Health CT are covered by the second insurer who sells policy on the exchange, ConnectiCare, which has filed a request to increase rates for individual health plans sold on that exchange by 4.9 percent. ConnectiCare said there are about 75,600 people covered under these policies.

The Anthem and ConnectiCare policies will be on the market as of Nov. 1, the start of the next ACA enrollment period, for coverage that begins Jan. 1, 2020.

The insurers cited several reasons for asking the Connecticut Insurance Department to approve rate increases, such as rising medical costs and an aging insured population.

The insurers also said the reintroduction of the Health Insurance Tax, or HIT, in 2020 prompted them to seek an increase in rates. The tax was implemented by the Affordable Care Act, was in place for 2018, suspended in 2019 and is due to take effect again next year.

“Suspending the Health Insurance Tax helped stabilize the individual market in 2019,” said America’s Health Insurance Plans, an industry trade group.

Connecticut Department of Insurance Commissioner Andrew N. Mais said Friday that “without the approximately 3 percentage point increase resulting from the recently reinstated federally mandated health insurer tax, the proposed increases are lower than last year’s.”

“In addition to the federal tax, ongoing rising cost of health care is a key driver of health insurance premium rate increase requests,” Mais said.

The Connecticut Insurance Department will consider public comments on these rate increase proposals and is also expected to hold a public hearing.

Many Connecticut residents who purchase health care policies on ACA exchanges like Access Health CT won’t feel the impact of any rate hikes the Connecticut Insurance Department might approve since they receive subsidies from the federal government to help them purchase insurance. About 75 percent of Access Health CT’s customers receive this federal help.

But Connecticut residents who don’t receive subsidies may see their premiums rise.

Insurers also requested rate increases for policies sold outside of Access Health CT and for small group policies sold off and on the exchange.

Anthem Health Plans, for instance, filed a rate request for an average increase of 14.8 percent on small group health plans for employers with 50 or fewer workers. The proposed rates are for plans marketed both on and off the state’s health insurance exchange and provide coverage for approximately 44,100 employees and their dependents, the insurer said.

The ACA enrollment period that begins in the fall and could be the last due to ongoing challenges to the law. A federal court in Louisiana is weighing an appeal to a lower court ruling that determined the Affordable Care Act is unconstitutional because a tax penalty imposed on those who do not have health insurance was removed in a massive federal tax overhaul.

The Supreme Court has already ruled that the “individual and mandate” that requires people to purchase insurance is constitutional because the government has taxing authority. But a group of Republican-led states seeking an end to the ACA argued that without the tax penalty, the individual mandate that is in the health care law is unconstitutional and cannot be severed from the rest of the ACA, making Obamacare invalid in its entirely.

The lower court agreed. A decision by the appeals court on whether that ruling will stand is expected in the next few months.

Correction: July 15, 2019
An earlier version of this story misstated the starting date of the next open enrollment period in Connecticut. It is Nov. 1, 2019, not Oct. 1, 2019.