The latest hike in insurance rates appears to be for customers of the two largest insurance companies in Oregon.
In 2016, the state’s two biggest health insurance providers, Moda Health Plan and Lifewise Health Plan, will increase rates between 24 and 37 percent.
It’s clear that higher enrollment is not leading to stable costs, according to an explanation of the decision, which was approved by the Oregon Insurance Division. In fact, insurance companies lost approximately $62 million in 2014 and losses are expected in 2015 as well. As a result, the Oregon Insurance Division felt the market needs to increase rates.
“Our ultimate responsibility to Oregon consumers is to ensure that rates cover the cost of health care,” said Insurance Commissioner Laura Cali.
The rate hikes are not without complaint. During the state’s rate approval process, petitioners complained about steep increases by Moda and Lifewise. Public comments were entered online.
“In my cynical thinking, I can’t help but wonder if Moda advertised relatively low premium rates for January 2014, knowing all along it would jack up premiums substantially once it got a good number of subscribers on board,” said E. Creed of Eugene.
Through the health exchange marketplace, Moda Health Plan had 42,633 members as of the end of June, while Lifewise had 27,128 members. Both companies also had large numbers of members who enrolled through traditional avenues used before the Affordable Care Act.
William Roberts of Portland, did not approve of Lifewise increases. “A proposed rate hike of anything over 10 percent on the rates I am already paying now will likely result in my family not being able to afford health insurance and will definitely cause my small business to close due to increased health care costs,” he said.
It’s worth noting that Oregon had some of the lowest insurance premiums in the nation for 2015. After tax credits, however, insurance prices tend to be relatively even throughout the nation.
With people reporting significant increases in their insurance premiums all across the US over the last couple of years, one might be curious about whether the Affordable Care Act really did much of anything to address the rising cost of healthcare after all. An article at Forbes notes that since 2004, premiums have been rising faster than income. That’s well prior to the ACA’s passage, and since then, premium increases haven’t been quite as drastic.
What do you think? Is the ACA working, or has it driven up prices despite its objective?