Expenses related to increases in the prices for medical care and prescription drugs in Vermont and Federal changes related to the Affordable Care Act require an 8.4 percent increase in premiums for Exchange-related qualified health plans, according to a rate filing prepared by Blue Cross and Blue Shield of Vermont, the state’s largest health insurer.
Blue Cross and Blue Shield of Vermont filed with Vermont’s Green Mountain Care Board proposed rates for 2016 qualified health plans. The rates filed by the company would increase premiums for individuals and small businesses by an average of 8.4 percent.
The company said in its filing that significant medical and pharmacy price increases were partially offset by favorable demographic and other assumptions within the company’s control. Combined, these factors produced a 5.3 percent increase in rates. The remainder of the 8.4 percent increase was driven by changes related to the Federal Affordable Care Act.
“We recognize that this increase is likely to be difficult to absorb for many individuals and small businesses who receive their coverage through qualified health plans, and we have done everything we can to reduce it, without risking access to quality care in the state” said Don George, president and CEO of Blue Cross and Blue Shield of Vermont.
“Unfortunately, a key factor contributing to premium growth has not changed. The Medicaid and Medicare cost shift continues to burden privately insured Vermonters with a disproportionate amount of health care cost increases.”
Blue Cross and Blue Shield of Vermont explained that there is no proposal in its filing to recoup costs incurred due to difficulties at Vermont Health Connect. And despite the fact that BCBSVT continues to enroll groups directly in qualified health plans, the company has kept its administrative costs as a percent of overall premiums relatively flat at 6.4 percent, which is well below the industry average.
Following its review, the Green Mountain Care Board is expected to issue a final decision on qualified health plan rates in mid-August. The new rates would then become effective beginning January 1, 2016 for individuals and small group employers.
Since 2013, the company and its approximately 400 employees have conducted extraordinary outreach and support initiatives to assist tens of thousands of Vermonters to navigate the troubled rollout of Vermont Health Connect. Currently there are more than 67,000 Vermonters enrolled through BCBSVT’s qualified health plans.
Blue Cross and Blue Shield of Vermont is the state’s oldest and largest health insurer, providing coverage for about 225,000 Vermonters. It employs about 400 Vermonters at its headquarters in Berlin and its Information and Wellness Center in South Burlington’s Blue Mall, and offers group and individual health plans to Vermonters. More information about Blue Cross and Blue Shield of Vermont is available on the Internet at www.bcbsvt.com Blue Cross and Blue Shield of Vermont is an independent corporation operating under a license with the Blue Cross and Blue Shield Association, an association of independent Blue Cross and Blue Shield Plans.
Source: Blue Cross and Blue Shield of Vermont May 18, 2015