(Updated 3:24 p.m.) As public pressure mounted state insurance regulators sent out a statement to the media Tuesday saying it agrees that the 22 to 30 percent rate insurance Anthem is seeking is “too high.”
“The rate Anthem requested is not necessarily the rate they are going to get, but some level of rate increase on certain policies will be needed based on adverse claims experience,” Debra Korta, spokeswoman for the state Insurance Department, said in an emailed statement. The statement goes onto say that the state regulators haven’t “identified the appropriate amount yet but will do so after we have completed a thorough analysis.”
Even though some believe Anthem could implement the rate increases as early as tomorrow, Korta said the company has agreed not to implement any rate increases until the Insurance Department takes final action.
“Anthem Blue Cross and Blue Shield has filed documents to support our rate request with the Connecticut Insurance Department and we are working closely with the Department to ensure that we provide any additional data or analysis to support their actuarial evaluation of the requested increase,” Sarah Yeager, spokeswoman for Anthem said. “We have agreed not to move forward with an increase until the department has completed their review.”
There are 56,000 members enrolled in Anthem’s individual insurance plans in Connecticut.
“Our proposed rate increase is a reflection of increasing health care costs,” Yeager said.
The public pressure started to mount last week after the state’s Health Care Advocate Kevin Lembo sent a letter to the Insurance Department asking it to reject the rate increase.
“The audacity of Anthem’s request and insensitivity to the families of Connecticut is troubling,” Lembo said. “In light of the terrible economic condition of our country, state and, most importantly our families, all health insurers should be held to a zero increase in rates.”
Lembo’s letter to the Insurance Department was followed by U.S. Sen. Chris Dodd’s letter Monday to Anthem’s President David Fusco.
“I strongly urge you to reconsider your plans which will dramatically increase rates for thousands of Connecticut residents,” Dodd wrote in this letter. “Should these new rates kick in, there is no question that additional Connecticut families will join the ranks of the uninsured.”
Dodd’s letter was followed by Attorney General Richard Blumenthal’s letter Tuesday in which he characterized the rate request as “humungous,” and urged the Insurance Department to reject it before the July 9 deadline.
“Equally unconscionable is proposed effective date of October 1, giving consumers less than three months to find less expensive, viable alternatives,” Blumenthal wrote in this letter to the Insurance Department.
‘Publicly available information indicates that a rate increase of this humungous magnitude under these circumstances clearly violates the statutory standard because it is ‘excessive,’” he said. ” The law certainly mandates rejection of such an egregiously excessive rate hike request, especially given the financial challenges faced by most Connecticut families.”
Blumenthal’s statement Tuesday was followed by one from the governor’s office.
“Governor Rell believes the rate increases sought by Anthem are simply too high and believes that a public hearing is warranted before any final rate decision is made,” Rich Harris, a spokesman for Gov. M. Jodi Rell said Tuesday. “Even if the global economic crisis were not causing enormous trouble for the state’s working families, it is difficult to see how such a drastic rate increase would be affordable for Anthem’s individual members.”
What A Rate Hike Would Mean for Consumers
Jenny Bass of Scotland, whose family had to make a decision earlier this year to shutdown its dairy farm after almost 300 years, said as business manager for the farm she did everything she could to try and save it. In 2007 that meant she took herself off of the farm’s insurance policy and signed up for an individual plan with Anthem.
“Now that our farm is shutting down I’m facing unemployment,” Bass said. “I can’t count on being able to pay for my insurance anymore.”
“We are budgeting all of the money we have from the sale of our cows hoping to meet all of our payments until we can sell the farm or figure out what we can do next,” Bass told a crowd of people gathered outside the Capitol for a health care rally Tuesday.
“While it may be more extreme with a farm family,” Bass said. “This is happening all over Connecticut and I just hate to see people be sick and broke on top of it.”