The Department of Consumer and Business Services (DCBS), through its Division of Financial Regulation, reviews rates for individual and small employer health plans to ensure that they are reasonable. That means rates are sufficient to cover costs so that health insurance companies can pay claims, but not excessive.
The division’s rate review process is known nationally for its transparency and strong standards. The division posts rate filings for individual and small employer health plans and all the information associated with the filings on www.oregonhealthrates.org. The public has the opportunity to comment on the filings through the website, public conference calls, and at public hearings. The division uses federal grant funds to contract with the Oregon State Public Interest Research Group (OSPIRG) to represent the public by choosing certain rate filings to review and participating in public hearings.
When reviewing rates, the division may consider factors such as an insurance company’s investment income, surplus, and cost-containment and quality-improvement efforts. It may also consider a company’s overall profitability, rather than just the profitability of a particular line of insurance.
Consumers can sign up to get emails about company filings, public conference calls, and hearings if they want to watch and provide comments.
Health reform and impact on 2017 rates
The Affordable Care Act (ACA) prompted significant changes in rates and plan designs starting in 2014. For example, plans cannot deny coverage for people with pre-existing conditions, and each plan must offer comprehensive coverage known as “essential health benefits” and cover preventive care at no out-of-pocket cost. Also, the “age gap” has been narrowed so older adults cannot be charged more than three times the rate charged to the youngest adults.
Rate increases were necessary for most 2016 individual plans, as the cost of providing coverage significantly exceeded the amount of premium collected.
Companies must submit rate filings for ACA-compliant plans by 11:59 p.m. on May 2, 2016, for individual and small employer health plans that will be available to Oregonians in 2017.
Companies will be considering a number of factors when setting rates for 2017. Companies now have two full years of claims data to use when making projections for 2017 and will be able to make more accurate claims projections. Other factors we expect companies to consider include medical cost trends and the elimination of the reinsurance program in 2017. Because all rate filings are due at the same time, the division can compare assumptions across the entire market and determine what is reasonable.
Companies must also report certain cost and quality metrics in their filings. Cost metrics include utilization and costs per member per month for emergency department visits, primary care visits, prescriptions, and other types of claims costs. The division is collecting these metrics for informational purposes only, and they will be available for the public to view.
Timeline for plan year 2017 rate filings
May 2, 2016: Rate filings for health plans due to the division
May 3, 2016: Division issues press release announcing proposed rates
May 6, 2016: Rate filings available on www.oregonhealthrates.org
May 6 – June 24, 2016: Public comment period
May 13, 2016: Comparison tables available on www.oregonhealthrates.org
May 31 – June 1, 2016: Public conference calls
June 16, 2016: Preliminary decisions posted on www.oregonhealthrates.org
June 16, 2016: Division issues press release announcing preliminary decisions
June 22 – 24, 2016: Rate hearings held in Salem and streamed online
July 1, 2016: Final proposed decisions posted on www.oregonhealthrates.org
July 1, 2016: Division issues press release announcing final proposed decisions
Late July 2016: Final 2016 rates available with comparison tables on www.oregonhealthrates.org Nov. 1, 2016: Open enrollment begins for 2017 plans
Learn more
Health Insurance Rate Review website:
www.oregonhealthrates.org
Consumer Guide to Health Insurance Rate Review in Oregon: oregon.gov/DCBS/insurance/healthrates/Documents/4961.pdf
