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10/17/2016

Insurance Department Announces 2017 Affordable Care Act Rates; Moves to Join Lawsuit Asking Federal Government to Make Required Payments to Insurers

Harrisburg, PA - Insurance Commissioner Teresa Miller today announced 2017 rates for individual and small group health insurance plans offered in Pennsylvania under the Affordable Care Act (ACA).  Open enrollment for these plans begins November 1 and runs through January 31.  Insurance company rates, based on their individual requests for 2017, include an average increase of 32.5 percent for individual plans and 7.1 percent for small group plans.  To view rates, click here.                               

Commissioner Miller also announced that the Insurance Department requested permission to file an amicus brief in support of Highmark, Inc. in its lawsuit to require the federal government to fund risk corridor payments to insurers that incurred higher claims than expected that has led to large insurer losses.

Throughout the 2017 review process, Commissioner Miller focused on making sure all Pennsylvanians continued to have access to health plans through the federal exchange at Healthcare.gov, which would allow for the many Pennsylvanians who meet income guidelines to be eligible to apply for subsidies for help paying premiums. 75 percent of Pennsylvanians who purchased plans through the federal exchange in 2016 receive subsidies to help pay premiums. 

These rate increases apply only to Pennsylvanians who get health insurance in the individual and small group markets, which together cover about 10 percent of those with healthcare coverage in the state.   These rates do not apply to larger employers, those with 50 employees or more, or government plans such as Medicare or Medicaid.

In 2015, Miller saved consumers nearly $80 million dollars by pushing back on rate increases filed for 2016. However, given challenges companies are facing and the failure of Washington, D.C. to live up to its obligation under the Affordable Care Act, insurance company requests for increased rates were critical to ensuring all Pennsylvania residents continued to have access to health plans through the federal exchange in 2017.

“Making sure the public is aware of these increases now is important to give consumers the time they need to make the best healthcare decision for both themselves and their families, said Commissioner Miller. “However, these rate increases make it clear that Washington needs to move swiftly to address consumer needs under the Affordable Care Act. In particular, Washington’s refusal to live up to the law it passed and fund risk corridor payments to insurers that incurred higher claims than expected has led to large insurer losses and companies leaving the exchange. That is why I am announcing that the Insurance Department on Friday asked the Court for permission to file an amicus brief in support of Highmark, Inc. in its lawsuit to require the federal government to make these payments.”

Congress specifically included the risk corridor provision in the ACA to promote stability in the exchange marketplace by providing this funding to insurers who incurred higher than anticipated claims costs to encourage insurers to offer products despite the uncertainty of costs associated with covering this new population. However, Congress has refused to authorize these payments.  Highmark, a major Pennsylvania insurer, filed suit against the federal government for these payments, which Highmark says cost it $223 million in 2014, alone.

Last week, Governor Wolf announced that Pennsylvania’s overall uninsured rate has dropped to 6.4 percent, according to recently released data from the US Census Bureau – well below the national average of 9.1 percent and 15th lowest in the US. Since Governor Wolf expanded Medicaid, more than 670,000 adults ages 18 to 64 (under the 138 percent federal poverty level) who did not previously have access to health care are now covered. The Wolf Administration will continue to work with the federal government, insurers, and stakeholders to give Pennsylvanians quality, affordable healthcare.

Current health plans are in effect through December 31. In order to have coverage under new or continuing plans begin January 1 and avoid any lapse in coverage, consumers must enroll in a plan for 2017 by December 15.  The last day of open enrollment for 2017 coverage is January 31, but consumers who enroll January 31 won’t have coverage until March 1.

To help consumers find their best plan, the Insurance Department has provided information on rates by area of the state, an explanation of the process for approving rates, and a shoppers’ guide to help individuals navigate the process of buying insurance on their website, www.insurance.pa.gov. On the main page, click on “2017 Affordable Care Act Rates by Rating Area” to see examples of rates in specific regions, and under the Consumers tab, click on “Health” to find the shoppers’ guide.

When open enrollment begins on November 1, consumers will be able to find all plans available on the federal Marketplace in Pennsylvania and each plan’s cost on www.Healthcare.gov.  

MEDIA CONTACT: Ron Ruman - 717-787-3289

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