Routine Medical Costs Responsible for Premium Rate Hikes, Insurers Say

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<p>Rising medical costs were the primary driver of recent rate increases by health insurers, accounting for three-quarters or more of the larger premium hikes requested between July 2012 and June 2013, a new <a href="/publications/issue-briefs/2013/dec/whats-behind-health-insurance-rate-increases-examination-what">Commonwealth Fund study</a> finds. </p><p>The analysis is the first ever to take a national look at the explanations insurers file with federal and state authorities to justify rate increases of 10 percent or more, as required by the Affordable Care Act. Currently, insurers are only required to submit rate increase explanations for non-grandfathered plans—those plans that became available after the enactment of the health reform law. </p>
<p>For the study, researchers Michael J. McCue of Virginia Commonwealth University and Mark A. Hall of Wake Forest University reviewed 311 filings from insurance plans covering 150 or more people in the individual and small-group markets. The review found that only about half the filings attributed any portion of rate increases to provisions of the health reform law that had gone into effect by 2013. Overall, those effects accounted for a small part of insurers' increases. </p>