Mike Smith is considered lucky. When, at age 21, he discovered a tumor the size of a golf ball on his neck, he had health coverage and a support system to support him.
“I was lucky because it was only stage 2A when I was diagnosed,” said Smith, now 35. “I was lucky that my mom worked a job that provided quality health insurance. Otherwise, I would still be out of nearly millions of dollars in medical care needed to keep me alive. But we must not leave the health and financial fortunes of our family, friends and neighbors to chance.”
Smith asked state insurance department officials to reject the average 20.4 percent increase insurance companies are seeking for 2023 Connecticut individual health plans.
“Health insurance prices have gone up. But unlike a pickup truck or an SUV, you can’t cut back on your health care and save on fuel,” he said. “When the cost of health insurance becomes too expensive, you are left without. We can, must and must do better.
“If we ask the hard questions, we can fix this system so that surviving a difficult medical diagnosis, both physically and financially, is not based on luck alone.”
Smith was one of dozens of residents and elected and appointed officials who addressed the insurance department Monday, asking its leaders to reject the insurance companies’ request to raise health policy rates for next year.
In addition to the significant average increase for individual plans, insurers selling policies on and off the Connecticut Affordable Care Exchange are seeking an average increase of 14.8 percent for small group plans.
The requests are significantly higher than what insurers requested last year for health policies for 2022. In 2021, carriers requested an average increase of 8.6 percent for individual plans and 12.9 percent for small group plans.
“I’ve taken care of tens of thousands of emergency patients…which means I hope I’ve improved the health of tens of thousands of people. I know I have saved the lives of probably hundreds of people. And unfortunately, in doing that, I also ruined the financial health of hundreds or thousands of people,” Phil Brewer, an emergency physician who has been in practice for 40 years, testified Monday. “I have said many times that I love what I do. But unfortunately, as a result of what I do, many of my patients end up bankrupt. I strongly oppose these rate hikes.”
Three insurers sell policies on the Connecticut Affordable Care Exchange: Anthem Health Plans, CTCare Benefits Inc. and ConnectiCare Insurance Company Inc.
Anthem requested an average increase of 8.6 percent for individual policies that cover 27,698 people. The proposed changes range from a 1.8% decrease to a 16.1% increase, depending on the plan.
The company also looked for an average increase of 3.6% on small group policies, which cover 19,271 residents. The proposed changes range from a 1.2% decrease to a 26.3% increase.
CTCare Benefits requested an average increase of 24.1 percent for individual plans that cover 75,003 people. The proposed changes range from an increase of 18.7% to 33.2% depending on the policy.
It also requested an average increase of 22.9 percent for small group plans that cover 3,476 residents (increases ranged from 20 percent to 28.9 percent).
ConnectiCare Insurance, which sells only individual policies on the exchange, asked for an average increase of 25.2 percent for plans that cover 8,782 people. The proposed increases range from 17.1% to 32.2%.
Several other companies, including Cigna and Aetna, sell plans over the counter.
Representatives from only two insurers — ConnectiCare and Cigna — attended and spoke at Monday’s public hearing in the legislative office building. A spokesman for the insurance department said only those two companies were invited because they had the highest requests of all carriers. Cigna is seeking an average increase of 19.6% for its non-exchange small group plans. ConnectiCare Insurance asked for an average increase of 29.3% on its small group policies off the exchange.
Sarah Souza, small group actuarial director for Cigna, said that even with the proposed increases for the 2023 plans, the company’s premiums will be lower than the market average.
“For silver plans, which are most popular with small employers, we have the lowest plan in six of the eight rating areas, representing the majority of places where small employers are located,” she said.
“All percentage increases are relative to the base figure. As such, while we may have among the higher proposed increases, we continue to have among the lowest actual out-of-pocket premium costs when all is said and done,” added Wendy Sherry, vice president of Cigna’s U.S. commercial markets.
ConnectiCare attributed the proposed increases to rising medical and pharmaceutical costs, as well as delayed care due to the pandemic.
Karen Moran, president of ConnectiCare, said Monday that the company has suffered more than $65 million in losses in the individual market over the past year because rate increases have not kept pace with higher utilization of medical services and the cost of prescription drugs. with a prescription, among other costs.
“For an insurance program to be sustainable, rates must be adequate to cover claims and the administrative costs of running the program. For the past year, the total insurance premiums we have received are far less than the cost of care we have actually financed,” she said. “Premiums previously approved by the insurance department were significantly below what was necessary to meet the needs of members. … The single most important driver in our proposed rate hike is getting rates back to an adequate level.”
“[Another] a significant driver of the required premium is the medical trend, which is the increased cost of reimbursing health care providers,” Moran said. “Utilization of medical and pharmaceutical services exceeded pre-pandemic levels in 2022 and is expected to continue in large part due to the needs of the people we serve.
“In short, we have not asked for anything more than is necessary to remain part of the exchange.”
But residents and elected officials said many would be unable to afford coverage if the proposed rate increases go into effect.
“I recently heard from an elderly woman who explained that she is making a choice about going without food, health care or prescriptions,” said Congressman Robin Comey, D-Branford. “I know these increases will put insurance even further out of reach for so many people – young people, seniors and young families.
“Many people I’ve spoken to are planning to delay their care at the expense of their long-term health and well-being. … Our goal as a country should be to insure as many people as possible, regardless of their age, zip code, or their racial and ethnic differences.”
Rep. Holly Cheesman, R-East Lyme, recounted her own ordeal buying insurance.
“Had this been six years ago, I would be sitting here as a member of the public when my husband died and my son and I had to take out individual policies. … I remember I had a dog bite and I thought it was better to put butterfly strips on him than to go to the emergency room because I would have all the expenses out of pocket,” she said. “So I think we have to remember the price that our residents pay, that their families pay, and really that small businesses pay.”
Attorney General William Tong asked insurance company representatives whether they conduct an analysis of whether customers can afford premiums before asking for an increase.
“From an actuarial perspective, it’s not a consideration when we set rates,” replied Neil Kelsey, vice president and chief actuary for ConnectiCare. “Our prices cannot be excessive, [they must be] non-discriminatory and must be adequate. These are the three conditions or thresholds that actuarial analysis must meet.’
Moran added that “the competitive market really helps determine whether our prices are affordable.”
Tong said Connecticut families are “suffering.”
“They are being squeezed from all over,” he said. “Gasoline, oil, natural gas and electricity prices continue to rise. We paid 13% more for groceries last month than we did a year ago. … Rent, housing, everything up. And so it is clear that Connecticut residents – individuals in the individual market, small groups, small businesses – cannot afford increases of up to 20.4% on average.
Actuaries from the insurance department are now reviewing the requested increases. They will examine trends in unit costs (total costs incurred by the company), service utilization and expected severity of claims as part of the process.
After the review, the department may approve the full requested increase, deny it, or change it to a different number. The final changes are expected to be published in late August or early September.
Open enrollment for 2023 health policies begins November 1.