PacificSource Rate Hike Will Hit 14.5% for Some Small Businesses
September 21, 2012 -- More than 36,000 Oregonians with small group health coverage will see rate hikes of 8.62% on average, and as high as 14.5%, if the premium rate hike proposed by PacificSource Health Plans goes forward.
“Health care already costs more than it should,” said Jesse O’Brien, OSPIRG Foundation Health Care Advocate. “Many Oregon businesses simply cannot afford rate hikes like this in today’s economy.”
The Oregon Insurance Division will hold a public hearing on the proposed rate hike at 4:00 PM on September 24 at the Labor and Industries Building, room 260, 350 Winter St. NE, in Salem.
OSPIRG Foundation’s Health Insurance Rate Watch Project will analyze the PacificSource filing to scrutinize their justification for raising rates, and submit comments to the Oregon Insurance Division. If approved, rate increases and plan changes would go into effect January 1, 2013.
“Health insurance companies could be lowering costs by cutting administrative waste, driving a hard bargain with hospitals on prices, paying doctors to keep people healthy rather than to order expensive treatments, and passing on those savings to customers,” said Jesse O’Brien. “But too often, this is not happening. Before allowing any rate hike, the Insurance Division should make sure PacificSource is doing all they can to keep costs down.”
PacificSource’s rate filing information can be viewed online at the following URL: http://tinyurl.com/977mtgb
Background on Oregon’s health insurance rate review program
In 2010, new rules went into effect strengthening the standards that health insurance companies must meet before raising premiums. Insurers must justify rate hikes in writing, showing that they are not excessive and explaining how the insurer is working to reduce costs. All rate filings are public information, available online, and open to public comment. The Oregon Insurance Division evaluates these justifications, and must take public input into consideration. Last year, the Insurance Division began to hold public hearings on significant rate increases.
Since these changes have taken effect, the Oregon Insurance Division has significantly stepped up their scrutiny of health insurers’ rate hike requests. Since 2010, it made cuts to a majority of requests, putting over $37 million back into consumers’ pockets. Earlier this year, PacificSource small business customers saved $2.1 million when regulators cut a proposed 5.6% rate increase down to 4.2%.