Mike Smith considers himself lucky. When, at age 21, he discovered a golf ball-sized tumor in 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, of Milford. “I was lucky that my mother worked at a job that offered quality health insurance. Otherwise, I’d still be crawling out of the nearly million 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 urged representatives of the state’s insurance department to reject the average 20.4% increase that insurance companies are asking for Connecticut’s 2023 individual health plans.
“Health insurance prices have increased. But unlike a pickup truck or an SUV, you can’t downsize your health care and save on gas,” he said. “When health insurance costs become too expensive, you go without. We can, must and must do better.
“If we ask the hard questions, we can fix this system so that survival driven by a difficult medical diagnosis, both physically and financially, is not based purely on luck.”
Smith was one of dozens of residents and elected and appointed officials who addressed the insurance department Monday, asking its leaders to reject a request by insurance companies to raise premiums for next year’s health policies.
In addition to the significant average increase in individual plans, insurers selling policies on and off the Connecticut Affordable Care Act Exchange are looking for an average increase of 14.8% in small group plans.
The requests are significantly higher than what insurers requested last year for 2022 health policies. Carriers in 2021 requested an average increase of 8.6% for individual plans and 12.9% for small group plans.
“I’ve been taking care of emergency patients in the tens of thousands … which means I’ve hopefully improved the health of tens of thousands of people. I know that I have saved the lives of probably hundreds of people. And unfortunately, in doing so, I’ve also ruined the financial health of hundreds or thousands of people,” Phil Brewer, an emergency physician who has practiced 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 in bankruptcy. I have strong opposition to these rate hikes.”
Three insurers are selling policies on the Connecticut exchange: Anthem Health Plans, CTCare Benefits Inc. and ConnectiCare Insurance Company Inc.
Anthem claimed an average increase of 8.6% for individual policies covering 27,698 people. The proposed changes range from a 1.8% decrease to a 16.1% increase, depending on the plan.
The company also claimed an average increase of 3.6% in small group policies covering 19,271 residents. The suggested changes range from a decrease of 1.2% to an increase of 26.3%.
CTCare Benefits claimed an average increase of 24.1% in individual plans covering 75,003 people. The proposed changes range from an increase of 18.7% to 33.2%, depending on the policy.
It also asked for an average increase of 22.9% in small group plans covering 3,476 residents (increases range from 20% to 28.9%).
ConnectiCare Insurance, which sells only individual policies on the exchange, asked for an average increase of 25.2% for plans covering 8,782 people. The suggested increases range from 17.1% to 32.2%.
Several other companies, including Cigna and Aetna, are selling plans over the counter.
Representatives from just two insurers — ConnectiCare and Cigna — attended and spoke at Monday’s public hearing in the Legislative Office Building. An insurance department spokesman said only those two companies were invited because they had the highest rate demands of all the carriers. Cigna is asking for an average increase of 19.6% for its small group plans outside the exchange. ConnectiCare Insurance asked for an average increase of 29.3% on its off-exchange small group policies.
Sarah Souza, small group actuarial director for Cigna, said that even with the proposed increase for 2023 plans, the company’s premiums would be lower than the market average.
“For silver plans, which are the most popular among small employers, we have the lowest plan in six of the eight rating areas that represent the vast majority of places where small employers are located,” she said.
“The percentage increases are all relative to the base figure. As such, while we may have among the highest proposed increases, we continue to have one of the lowest out-of-pocket premium costs when all is said and done,” added Wendy Sherry, Cigna’s vice president of US commercial markets.
ConnectiCare attributes 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 suffered more than $65 million in losses in the individual market last year because rate increases have not kept up with higher utilization of medical services and the cost of prescription drugs, among expenses others.
“For an insurance program to be sustainable, fees must be adequate to cover claims and the administrative costs of running the program. “For the past year, the total insurance premiums we’ve received are far less than the cost of care we’ve actually funded,” she said. “The premiums previously approved by the insurance department were significantly lower than what was necessary to meet the needs of members. … The single most important driver in our proposed rate hike is to restore rates to an adequate level.”
“[Another] “The significant driver of the asking premium is the medical trend, which is the increased cost of reimbursing health care providers,” Moran said. large because of the needs of the people we serve.
“In short, we haven’t asked for more than we absolutely need to to remain part of the exchange.”
But residents and elected officials said many won’t be able to afford coverage if the proposed rate hike goes into effect.
“I recently heard from a senior who explained that she was making a choice about going without food, health care or prescriptions,” said Rep. Robin Comey, D-Branford. “I know these increases will push insurance even further out of reach for so many people – young adults, 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 state should be to insure as many people as possible regardless of their age, their zip code, or their racial and ethnic disparities.”
Rep. Holly Cheeseman, R-East Lyme, recounted her struggles buying insurance.
“If this was 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 make individual policies. … I remember being bitten by a dog and deciding I’d rather put butterfly bands on it than go to the emergency room because I would have that full cost out of pocket,” she said. “So I think we have to remember the price that our residents are paying, that their families are paying, and really that small businesses are paying.”
Attorney General William Tong asked insurance company representatives whether they conduct an analysis of whether customers can afford their premiums before asking for an increase.
“From an actuarial standpoint, that’s not a consideration when we set rates,” replied Neil Kelsey, vice president and chief actuary for ConnectiCare. “Our fees cannot be excessive, [they must be] non-discriminatory and they must be adequate. These are the three determinations or thresholds with which the actuarial analysis must conform.”
Sherry added that “it’s the competitive market that really helps determine whether our rates are affordable.”
Tong said Connecticut families are “suffering.”
“They are being squeezed in every way,” he said. “The price of gasoline, home heating oil, natural gas and electricity are still rising. We paid 13% more for groceries last month than a year ago. … Rent, flats, all 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 with the insurance department are now reviewing the requested increases. They will examine trends in unit cost (total expenses incurred by the company), utilization of services and expected severity of damages as part of the process.
After 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 on November 1.