Rate increases sought by BCBS and MVP

MONTPELIER — The state’s two health insurance providers offering individual and business plans on Vermont Health Connect have submitted requested rate increases to the state for next year.

Blue Cross Blue Shield of Vermont and has requested an 8.4 percent increase in rates, while MVP Health Care is asking for a 3 percent average rate increase, according to the Green Mountain Health Care Board, the state’s regulatory body for health care issues.

In its filing with the GMCB, BCBS said state and federal mandates are a significant reason for the rate increases for its federally qualified health plans, as well as rising medical and pharmaceutical costs.

“In the absence of mandated changes associated with the Affordable Care Act, a 5.3 percent increase would have been requested,” BCBS wrote in its filing.

Actual rate increases, depending on health plans, range between 4.7 percent and 14.3 percent for BCBS. The changes will impact about 41,000 customers and amounts to about $29.4 million in higher premiums, according to the filing.

“We recognize that this increase is likely to be difficult to absorb for many individuals and small businesses who receive their coverage through qualified health plans, and we have done everything we can to reduce it, without risking access to quality care in the state,” BCBS President and CEO Don George said in a statement. “Unfortunately, a key factor contributing to premium growth has not changed. The Medicaid and Medicare cost shift continues to burden privately insured Vermonters with a disproportionate amount of health care cost increases.”

Increases requested by MVP, meanwhile, range between a decrease of 1.8 percent and an increase of 27.3 percent. The 27.3 percent increase is for the company’s catastrophic health plan.

MVP has a much smaller customer base, however, so the changes will impact 3,324 customers and lead to $951,000 in higher premiums paid.

Gov. Peter Shumlin on Monday said the increases are higher than he would like. But the increases sought for health plans on Vermont Health Connect, the state’s online health insurance marketplace created under the federal Affordable Care Act, are lower than would be expected for plans outside the exchange, he said.

“Let’s be honest, that’s going to look good compared to what businesses are used to,” he said.

Part of the increase should be attributed to the so-called cost shift, the governor said, where private insurance picks up the cost of low payments to providers by Medicaid and Medicare.

“We keep kicking the can down the road on Medicaid, so the cost shift happens to everyone paying for insurance, including the exchange. That’s private insurance,” Shumlin said.

Lawmakers, who wrapped up the first half of the legislative biennium on Saturday, rejected Shumlin’s plan to institute a 0.7 percent payroll tax on Vermont businesses to address the cost shift. The plan would have raised $90 million that would have been matched by $100 million in federal funds. That money would have allowed the state to boost Medicaid payments and ease the burden on private insurance.

Two public hearings will be held by the GMCB at the State House this summer. The public can comment on the MVP request on July 28 and those wishing to comment on the BCBS request can do so on July 29. The board will make a decision by August 13 on the rates that will take effect Jan. 1, 2016.

neal.goswami@timesargus.com

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