Insurance Department Reduces Rate Hikes, but Criticism and Calls for Reform Persist

Following numerous hearings and complaints, the Insurance Department has successfully lowered the average rate increases for individual insurance plans sold within the state. Initially proposed at a 12.4% increase, these rates have now been reduced to a 9.4% increase. Furthermore, the department has halved the requested average rate increase for small group plans, lowering it from 14.8% to 7.4%.

These adjustments directly impact the lives of 188,000 people residing in the state. Insurance Commissioner Andrew Mais emphasized the department’s commitment to consumers, highlighting the diligent work of their team of actuaries and professionals in mitigating these requested health insurance rate hikes. However, he acknowledged that the challenge lies in addressing the root causes of escalating premiums.

Mais stated, “Our goal is crystal clear: access by Connecticut consumers to a robust and competitive health insurance market while effectively managing insurance costs.”

The Insurance Department plays a crucial role in evaluating rate increase requests to ensure they are neither excessive, inadequate, nor discriminatory. In the previous year, the agency approved rate increases averaging 12.9%, considerably lower than the average 20.4% increases sought by insurance carriers.

Attorney General William Tong, who had criticized the original rate requests, acknowledged the department’s move to reduce them but emphasized that the remaining rate hikes are still unreasonably high and financially burdensome. He asserted that insurers currently lack incentives to control healthcare costs or premiums, negatively impacting Connecticut families and small businesses.

Tong said, “We need to change this. Connecticut’s review process is far too condensed and opaque to challenge the insurance industry’s unjustified and unsupported assumptions.”

In response to these concerns, lawmakers have pledged to reform the rate-setting process. Senate President Martin Looney and Sen. Jorge Cabrera advocate for future rate hearings to adhere to strict Uniform Administrative Procedures Act rules, similar to Public Utility Regulatory Authority (PURA) hearings on proposed rates. They also stress the importance of considering affordability and implementing a ‘presumption of denial’ for proposed health insurance rate increases exceeding inflation.

The actual rate increases vary depending on the specific plan individuals have chosen, ranging from 9.8% to 17.5% for individual plans and from 7.5% to 23% for small group plans. The primary responsibility of the Insurance Department is to ensure that insurance companies collect adequate monthly premiums to maintain their financial stability. For detailed information on specific plans and final rate increases, please visit the Insurance Department’s website.