Public Comments Due on Regence Rate Hike

If approved, some small businesses will see rates jump over 15%

OSPIRG Foundation

Oregonians impacted by Regence’s small business rate increase proposal have until the end of the day Tuesday, January 10th to submit public comments to the Oregon Insurance Division.

“We’re seeing some family premiums reach $2000 per month and beyond,” said Laura Etherton, OSPIRG Foundation’s health care advocate. “It’s critical for the Insurance Division to hear from small businesses that pay the bills.”

Consumers and small businesses can find the details of the rate hike proposal, and post a public comment on the Oregon Insurance Division’s website.

If Regence BlueCross BlueShield’s proposal is approved, small businesses will see rates rise 8.0% on average, with some jumping more than 15% in the next year, according to an analysis by OSPIRG Foundation’s Health Insurance Rate Watch project.

Key findings in the analysis include:

• Regence may be over-estimating medical cost increases. Regence’s actual claims costs have gone up only 3.6% in the previous year, but it says it expects medical costs to increase by 10.8% next year.

• While it’s clear some businesses will see rate increases exceed 15%, the rate filing doesn’t state the maximum rate increase a small businesses might experience.

• Regence has not explained why it wants to have businesses with older employees, and in certain locations in Oregon, pay even more.

“This is a significant rate hike for many small businesses,” said Etherton. “As it stands right now, we are concerned Regence has not fully justified this increase.”

OSPIRG Foundation agrees with Regence on a key point, that the key to stabilizing enrollment is in making insurance more affordable. Etherton urged all insurance companies to redouble efforts to cut costs – not by raising deductibles and cutting care – but by cutting waste and focusing on prevention.

Background on Oregon’s health insurance rate review program:

In 2010, new rules went into effect strengthening the standards that health insurance companies must meet before raising premiums. Insurers must justify rate hikes in writing, showing that they are not excessive and explaining how the insurer is working to reduce costs. All rate filings are public information, available online, and open to public comment. The Oregon Insurance Division evaluates these justifications, and must take public input into consideration. More recently, the Insurance Division has begun to hold public hearings on significant rate increases. More information is available at the Insurance Division’s website.

OSPIRG Foundation’s Health Insurance Rate Watch project provides analysis and comments of health insurance rate filings from a consumer perspective. The project’s advisory committee includes small business and consumer experts such as AARP-Oregon and Consumers Union.