Catamount health insurance rates rise nearly 12 percent

by Andrew Stein July 24, 2013 vtdigger.org For the final six months of the Catamount health insurance plan, rates will be 11.9 percent higher than they have been for the past two years.
The plan and the state’s premium assistance program will cease to exist on Jan. 1, 2014, because they do not fit into new federal laws under the Affordable Care Act, aka Obamacare.
Blue Cross Blue Shield of Vermont, which is the only insurer providing the plan, initially proposed a 24.4 percent increase. The Department of Financial Regulation cut that Catamount rate hike back to a 13.9 percent increase, and the Green Mountain Care Board pared back that uptick by 2 percent.
State officials say the rise in rates will not directly affect the roughly 11,500 Vermonters who are enrolled in the state-subsidized Catamount program. The state will absorb the hike, which is expected to cost less than $4 million. On the other hand, the 3,500 Vermonters enrolled in Catamount who don’t receive subsidies will see their rates rise by about 12 percent.
Kevin Goddard, vice president of external affairs for Blue Cross, previously said the company was hoping to increase rates by 24.4 percent to raise about $8 million ‘enough to cover the insurer’s projected costs of the Catamount plan for the remainder of the year. But both the Department of Financial Regulation and the Green Mountain Care Board determined that the insurer didn’t need such a hefty hike.
‘This is a population, particularly the ones who are paying the full prices, who are bearing a heavy burden in terms of health care costs,’said Anya Rader Wallack, chair of the board. ‘We looked for every way to legitimately pare back what was a really hefty proposed increase on top of rates that are unaffordable for a lot of people. We’re very sensitive to the fact that this population doesn’t have a match from their employers and could potentially be paying for the full cost.’
Specifically, the Green Mountain Care Board called for reduced medical and pharmaceutical growth trends. Those are the projected cost increases that influence a large portion of a health insurer’s rates. The board also called for eliminating Blue Cross’s proposed contribution to surplus from the plan. Blue Cross increased its reserves $12 million in 2012, from $113.91 million to $125.95 million.