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Final Rates Confirm Rhode Islanders’ Insurance Is Getting Even More Expensive

By September 5, 2018No Comments

Washington, D.C. – Today, Rhode Island announced final rates for 2019 individual-market health insurance plans, which indicate average benchmark premium increases of 8.1 percent, due to the Trump Administration and Washington Republicans’ health care sabotage. Health insurance analysts estimate that absent GOP sabotage, the cost of individual-market health insurance plans nationwide would drop 4.3 percent. Brad Woodhouse, executive director of Protect Our Care, released the following statement in response:

“For the past year and a half, President Trump and his Republican allies in Congress have engaged in a deliberate, aggressive campaign to undermine health care and families in Rhode Island are once again forced to pay the price. Until we stop Republicans’ war on health care, insurance companies will continue to make huge profits and enjoy record tax breaks from Republicans while they charge working families more and more. Washington Republicans should start working on bipartisan solutions to make coverage more affordable, instead of helping their friends in the insurance industry make another buck on the backs of hardworking Rhode Islanders.”

From the Experts:

Office Of The Rhode Island Health Insurance Commissioner: Rates “Made Against The Backdrop Of Continuing Uncertainty Over Federal Policy Actions Around The Affordable Care Act.” “This year’s rate filings are made against the backdrop of continuing uncertainty over federal policy actions around the Affordable Care Act, such as the discontinuance of both Cost Sharing Reduction subsidies and penalties for not having insurance.” [Rhode Island Health Insurance Commissioner’s Office, 5/31/18]

Rhode Island Health Insurance Commissioner Marie L. Ganim: “This Has Been A Challenging Year As We Have Faced Multiple Policy Decisions At The Federal Level Designed To Undermine Market Stability.” [Rhode Island Health Insurance Commissioner’s Office, accessed 9/5/18]

Neighborhood Health Plan Of Rhode Island: “Key Drivers Of The Rate Increase Include” Mandate Repeal. “The range of rate changes, before reflecting changes in age, which consumers will experience, is approximately 7.9% to 9.6%. Key drivers of this rate increase, further described below, include: Repeal of the individual mandate penalty affecting medical service costs…  In 2018, the federal administration also repealed the individual mandate penalty which previously required all US citizens or permanent residents to obtain qualifying health insurance or pay a tax penalty greater than zero dollars. Repeal of the mandate penalty will result in approximately 1.9% increase of premiums, assuming healthy individuals will no longer purchase health insurance.” [Neighborhood Plan of Rhode Island, 5/31/18]

Brookings Analysis Estimates That Individual Market Premiums Would Decrease If Not For GOP Sabotage. Among its key findings:

  • Estimates That Average Premium Would Fall By 4.3 Percent In 2019 Absent GOP Sabotage. “I estimate that the nationwide average per member per month premium in the individual market would fall by 4.3 percent in 2019 in a stable policy environment.” [Brookings Institution, 8/1/18]
  • Insurance Companies’ Revenues Will Far Exceed Their Costs In 2018. “I project that insurers’ revenues in the ACA-compliant individual market will far exceed their costs in 2018, generating a positive underwriting margin of 10.5 percent of premium revenue. This is up from a modest positive margin of 1.2 percent of premium revenue in 2017 and contrasts sharply with the substantial losses insurers incurred in the ACA-compliant market in 2014, 2015, and 2016. The estimated 2018 margin also far exceeds insurers’ margins in the pre-ACA individual market. ” [Brookings Institution, 8/1/18]

America’s Health Insurance Plans: Republican Sabotage Will “Drive Up The Rate Of Premium Increases.” “Policies that disproportionately draw healthy consumers away from the individual market, like expanding access to short-term plans, will likely have an even more devastating effect on affordability, choice and competition. This will further result in adverse selection, drive up the rate of premium increases, and exacerbate affordability issues for many other people.” [America’s Health Insurance Plans Letter to HHS, 4/20/18]

Kris Haltmeyer, Blue Cross Blue Shield Association Vice President: “With The Repeal Of The Individual Mandate And The Failure Of Congress To Enact Stabilization Legislation, We Are Expecting Premiums To Go Up Substantially.” Kris Haltmeyer, a vice president at the Blue Cross Blue Shield Association, told reporters that the premium increases were in part due to the repeal of ObamaCare’s individual mandate in the Republican tax reform bill in December. He also cited lawmakers’ failure to pass a bill aimed at shoring up the market, which fell apart earlier this year amid a partisan dispute over abortion restrictions. ‘With the repeal of the individual mandate and the failure of Congress to enact stabilization legislation, we are expecting premiums to go up substantially,’ Haltmeyer said. He estimated that average premium increases nationwide will be in the ‘low teens,’ but that there will be major variation across areas, ranging from the low single digits to up to 70 or 80 percent.” [The Hill, 5/23/18]