Health Care

Cigna requests more Obamacare premium rate hikes, but a competitor wants decreases

TNS

One of the insurance companies that sells Obamacare plans in Kansas City has requested premium hikes of up to 25.7 percent for some 2019 plans. But a competitor is asking for decreases almost as big.

Cigna Health and Life Insurance Co. requested rate hikes that average out to 7.3 percent across all its individual plans, but are three times higher than that for some, according to documents filed with the Missouri Department of Insurance.

Cigna’s filing they said the rate hikes could affect about 108,000 people statewide and are aimed at improving the profitability of the Obamacare plans.

“Cigna’s 2017 financial results in Missouri are worse than the level required for long-term sustainability in the market,” the documents state. “The proposed 2019 rate increase is expected to bring loss ratios in line with Cigna’s target level.”

Jim Angstadt, the company’s communications manager, said via email Thursday that the rate filings “are based on our customers’ historical claims experience, expected medical costs trends, product changes, and overall market performance.”

“The long-term success of the individual health insurance market starts with rational, competitive pricing, as reflected in our filing,” Angstadt said. “We look forward to continuing to work constructively with the Missouri Department of Insurance to deliver a healthy and sustainable individual health plan marketplace that benefits the health, well-being, and sense of security of our customers.”

The Affordable Care Act, commonly called Obamacare, allows people who don’t get health insurance through an employer or the government to buy individual plans that are subsidized based on their income.

Those who qualify for the subsidies will be shielded from rate hikes, but the Obamacare plans have become increasingly unaffordable for those who make too much to qualify for subsidies.

Premium rates for the various plans depend on where customers live, the level of coverage and whether they use tobacco.

Cigna’s filing shows that some customers could see a small decrease in rates: as much as 1.6 percent.

It appears Cigna is getting closer to its Obamacare financial targets. The company requested much bigger rate hikes last year: 43 percent on average and a maximum of 73 percent.

Cigna also has more competition in the Kansas City market this year. Minnesota-based Medica announced in June it would expand across the Kansas border and start offering its Select plans in Cass, Clay, Jackson and Platte counties.

Because those plans are new, there was no rate change information filed for them.

Kansas City’s other Obamacare insurer, Ambetter, has asked the state insurance department for rate decreases averaging about 8.6 percent, and some Ambetter rates could drop by almost 20 percent.

Ambetter filed its Missouri rate requests under the name Celtic Insurance Co., a division of Missouri-based Centene.

Centene has been expanding its Obamacare footprint even as some other insurers, including Blue Cross and Blue Shield of Kansas City, have fled the ACA market, citing losses and regulatory uncertainty.

Centene moved into the Kansas and Missouri exchanges last year and its CEO, Michael Niedorff, told CNBC recently that it has had no trouble making Obamacare work financially and the company remains bullish on its ACA plans.

Kansas Insurance Department officials said they couldn’t provide a breakdown of rate requests by insurer, but the average proposed rate increase in Kansas for all individual and small group plans is “slightly less than 6 percent.”

“We again have a competitive market in Kansas for 2019,” Kansas Insurance Commissioner Ken Selzer said in a statement, “with every county having plan choices available from multiple insurance carriers.”

Medica and Ambetter sell plans on the Kansas side of the Kansas City metro. The federal Obamacare website, healthcare.gov, shows that Medica has asked for average rate hikes of 6.81 percent and Ambetter is seeking average hikes of 2.68 percent on their Kansas ACA plans. No range is provided.

The rate requests made public Wednesday are subject to approval by state insurance departments and aren’t usually finalized until September. Customers can start shopping for plans in October.

Consumers have 30 days to comment on the proposed rate hikes and can do so on the insurance department websites for their states.

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