Insurance Commissioner Andrew Mais at the 2019 public hearing on rate increases.

Insurance Department regulators said Friday that despite an increase in health care costs they are knocking down the average increases requested by health insurance carriers. 

They cut the average rate request in the individual by 35% from 8.6% to 5.6% and they reduced the increase in the small group market by 48% on average from 12.9% to 6.7%. 

That’s even though medical costs have increased almost 9% and prescription drug costs have increased almost 11% over the past year. 

The 222,700 members enrolled in individual and small group plans are projected to save approximately $76 million next year due to the rate request reductions. Over two years, the Insurance Department’s rate reductions have saved Connecticut consumers approximately $173 million.

“Working on behalf of consumers, the Department was able to reduce the health insurance rate increase requests thanks to the hard work of our actuaries and professional staff, but we need to work to address the skyrocketing health care costs these premiums cover,” Insurance Commissioner Andrew Mais said. “The unit cost of hospital inpatient and outpatient care has historically risen about 9% per year. Prescription drug prices have risen even higher. I will continue to work collaboratively with all stakeholders to find long-term solutions that promote access and eliminate barriers to coverage here in Connecticut.”

State Healthcare Advocate Ted Doolitte said the Insurance Department’s rate cut doesn’t “inspire confidence that the carriers have all the tools they need to hold down medical costs.”

He said the carriers are correct that high medical prices are driving the increase in premiums, but he said hospitals and medical providers should be summoned to testify about why they are charging such high rates.

“Justifying these underlying medical prices in public is especially urgent in our new high-deductible world, where most consumers have to pay all of their own non-routine medical expenses, at whatever price is negotiated by their insurance companies,” Doolittle said. 

“Even with the cuts, the approved requests are high,” he added.  

A handful of consumers testified in person and hundreds more submitted written testimony to tell the Insurance Department that premiums were unaffordable before the proposed rate hikes. 

However, the Insurance Department is only allowed to make sure the premiums are sufficient enough to cover claims and keep the carriers solvent. They are unable to look at affordability as a factor in setting the rates.