Insurers caution brokers about higher premiums
There's much controversy about whether the reform law will lead to higher premiums. People from all aspects of the industry, even lawmakers who recently held a Congressional hearing on premiums, are adding their opinion on the subject.
Well it seems those who have been predicting a rise in premiums may be correct. Insurers have been privately warning brokers and agents that premiums for individuals and small businesses could dramatically increase next year and, in some cases, could even double, reported The Wall Street Journal.
Insurers are "not being shy that premiums are going to increase in 2014," and are urging brokers to "brace our clients," John Lacy, vice president of group benefits at brokerage firm Bouchard Insurance in Clearwater, Fla., told the WSJ.
UnitedHealth told brokers in a private presentation last month that premiums for some individual consumers would jump by as much as 116 percent and small business plans' premiums could grow by as much as 25 percent to 50 percent.
However, UnitedHealth said those premium increases represent the "high-end scenario" instead of an average growth. In some scenarios, including for older consumers, premiums could actually decrease, Jeff Alter, who leads UnitedHealth's employer and individual insurance business, told the WSJ.
Meanwhile, Aetna told its national broker advisory council last fall that individual rates that aren't grandfathered under the reform law could grow by 55 percent on average, while its small businesses may see a 29 percent increase. And Blue Cross Blue Shield of North Carolina recently told brokers that its individual premium rates could increase by as much as 40 percent to 50 percent. But a BCBSNC spokeswoman told the newspaper that it doesn't have final numbers on premiums.
BCBSNC CEO Brad Wilson told the brokers that although the reform law will help millions of new consumers gain health coverage, "it will come at a cost" of higher premiums, FierceHealthPayer previously reported.
To learn more:
- read the Wall Street Journal article
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