One Insurance Company Withdraws, Another Reduces Rates
The state’s health insurance marketplace hasn’t started enrolling individuals yet, but one company is withdrawing from the small group market while another reduced its monthly premiums.
ConnectiCare Benefits Inc. announced on Friday that it will withdraw its application for the small group market and focus solely on the individual market in the exchange.
That leaves Anthem, United Healthcare, and Healthy CT as the only three companies offering a small group plan inside the insurance exchange.
ConnectiCare “has made the business decision to focus its attention and resources on participating only in the individual Exchange in 2014,” a statement from the company says.
“ConnectiCare will continue to deliver the best-in-class products and services that we always have provided, and we believe that we should focus on the needs of individual purchasers on the Exchange,” ConnectiCare President Michael Wise said. “We remain committed to the success of Access Health CT, and are excited about partnering with Access Health CT on the individual Exchange in 2014.”
According to the statement, ConnectiCare will continue to monitor developments in the small group exchange and will give serious consideration to introducing products in the small group market on the exchange in the future.
At the moment there are just too many questions. In a letter included in its rate filing with the state Insurance Department, the company expressed concern about the new law and regulations.
“The federal and state regulatory environment since the passage of the ACA has been unclear, confusing and fluid,” Neil Kelsey, vice president of actuarial services for ConnectiCare, said. “Many of these regulations are complex, vague, incomplete and even contradictory.”
With only about 40,000 people expected to enroll in the small group plans, ConnectiCare’s decision to leave the small group exchange won’t have much of an impact, Ellen Andrews, executive director of Connecticut Health Policy Project, said.
“Three health plans with very similar rates is not competition,” she said.
There are no penalties under the Affordable Care Act for small businesses with under 50 employees if they don’t offer insurance to their employees. The penalty for large employers was delayed until 2015 by the Obama administration earlier this month.
HealthyCT, the only nonprofit consumer operated and oriented plan participating in the exchange, announced last week that it revised its average monthly premiums and they would be lower than initially expected.
The average monthly premium for an individual could be as little as $271 per month, and the average for the small group plan would be $408 per month, but those amounts will vary greatly depending on age, location, and which plan is selected. There will be various plans that cover certain benefits that will be identified through medal tiers called bronze, silver, gold and platinum.
The reduction in the rates occurred after actuaries consulting with the company concluded that residents signing up for the plan would be healthier than previously anticipated.
When it first filed its rates for review in May, HealthyCT — which has no claims data to base its rates upon since it is new to the market — estimated the monthly premium for an individual would be about $427 per month. Its small group plan anticipated charging on average about $446 per month.
The reduction in rates last week for the company was good news for the exchange, which is expected to sign up about 100,000 residents in its first year of operation.
“We have a ways to go in terms of implementing the ACA, and there will be times when rates come in higher than what we’d like to see,” Access Health CT CEO Kevin Counihan said in a statement. “However, the rates filed by HealthyCT are a strong indication that we’ll soon be making progress toward our goal of providing affordable, quality healthcare to those who don’t currently have it.”
All the rates for all the companies participating still have to receive approval from the Connecticut Insurance Department before they are finalized. The actuaries are expected to present their information to the board of Access Health CT on Tuesday, July 30, and rates will be finalized before the end of the month.
Enrollment in the exchanges will begin this October with plans going into effect Jan. 1, 2014.