Albany, NY – New Yorkers face an average hike in health insurance premiums exceeding 8 percent next year, more than twice the inflation rate, according to state data, and many policyholders are set to pay double-digit increases.
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Rate increases affecting more than 2 million policyholders are now subject to state approval under a 2010 law. The measure was meant to slow the rapid rise in premiums that are based mainly on insurer projections of rising treatment costs and patient usage.
The Department of Financial Services, successor to the state Insurance Department, said it has approved weighted average increases of 8.2 percent next year, compared with the 12.7 percent requested by a dozen insurance companies and health maintenance organizations. Hundreds of approved rates for individuals, small groups and some large groups are posted online, along with supporting information previously kept confidential.
“The public has a right to know the basis for rising premiums,” Superintendent Benjamin Lawsky said. His goal is to keep rates as low as possible but not drive insurance carriers out of the New York market, and the calculations envision insurer profit margins of a few percent, he said.
Before the state’s approval was required, health insurance premiums were going up on average 14 percent a year in New York, Lawsky said. The agency held it to 10 percent this year, though medical costs rose 11 percent. With 2012’s anticipated 8.2 percent hike, compared with medical costs rising about 9 percent, there’s a two-year savings of more than $500 million, he said.
Insurer projections, commonly called the “medical trend,” are based on the previous two years’ claims.
For example, Aetna Health Inc.’s Healthy New York-Standard and Healthy New York-High Deductible base medical plans for all regions were approved for proposed premium increases of 12 to 12.5 percent starting Jan. 1. In its application, the company cited a 17 percent increase in costs per claim for hospital services, which can reflect changes in contract rates, more intensive services and more expensive technologies, and a 3 percent increase in the use of hospital services.
The company said 90 percent of premiums are used for medical care, more than the 82 percent New York law requires. It projected a 4 percent increase in both doctor services and drugs with no rise in costs per claim.
Empire Health Choice HMO requested a 26.2 percent increase for its small-group base plan and was approved for 16.2 percent. In its application, it projected increases for hospital inpatient and outpatient care, doctor services and prescription drugs.
The department has its own actuaries and does full analyses of proposals, spokesman David Neustadt said.
But the approved rates are still high, more than double the national consumer price index, said Arthur Levin, director of the Center for Medical Consumers, an advocacy group. The federal CPI was 3.5 percent for the past 12 months.
“It’s why this stuff is unsustainable,” Levin said. Arguments over the root cause vary nationally, though he said a recent study showed U.S. physician fees are higher than elsewhere.
Charging per service gives doctors an incentive to do more, new imaging techniques tend to supplement old ones instead of replacing them, and the high costs of the sickest patients, including those near death, get shifted through insurance among everyone else, Levin said.
“The bulk of the population, they don’t use the system much,” he said.
Everything is going up, except people’s wages. The democrats will be thrownhout of office next year.
Yes it is unsustainable and Blue Cross will be pulling their small business plans in April. Aetna and Oxford fees are through the roof. The cost of the insurance itself is huge, plus the deductibles are high. More and more doctors are opting out of the system. We are at a point where we are forced to decide whether or not it pays to have basic coverage or just pay out of pocket for doctor visits and just get a catastrophic policy for hospital or surgical care.
On top of this, Obama’s plan, is to force employers to pay these exorbitant prices for their employees when they can’t even maintain it for themselves. The government wants to make sure they keep the insurance companies here, how about keeping industry and jobs here. Wouldn’t that make more sense?
This situation is becoming scandalous. The insurance companies can complain all they want, but WHO gets an automatic 12% salary increase just because their expenses go up?? WHO??! We are paying close to $600 a month for the premium plus a $100 per month deductible per adult!
Thank you Mr. Obama of OBAMACARE – it’s been a “pleasure” having you self-serve the American people for 3 years too many.
Half of NY is on medicaid anyways, this won’t be affecting many people.
What a bunch of hypocrites. Every time the insurance companies seek to limit coverage for some new benefit the politicians try to make mandatory, everyone yells gevalt. For example, the some states recently mandated coverage for various kinds of autism treatments and other forms of mental health coverage at the same level as any other physical disease without any annual limits. Just last week, there were those demanding that insurance companies continue paying the full cost of an off label drug treatment for breast cancer which had been shown not to be cost effective and the FDA refused to certify. If you want to reduce health care premiums, don’t mandate coverage requirements. If a parent with an Autistic child wants full coverage, let them buy a special policy but don’t make everyon else pay the cost. If insurance companies want to penalize smokers or overweight people based on legitimate actuarial data, let them. If the government wants to subsidize the costs of policies for those who cannot afford to pay the costs of market-based actuarial premiums, do so but don’t require the rest of us to pay the higher payments.
More people will go onto medicaid its the best and cheapest insurance!
I pay over $800 a month for insurance and they don’t cover everything.
I blame the government agency’s and the hospitals.
Hospitals over charge because of all the regulations the government demands.
here we go again: we can only blame ourselves for this mess. just remember for whom most jews voted for: it’s barak hussain obama, not bush.
the liberal jews didn’t want to hear about bush; all they knew was the, “democrats.”
we all knew what obama stands for. why did most jews vote for him?
we will never learn from this mistake; come next election, we will still vote for the democrates–the losers.
if it’s your own fault, don’t complain: blame only yourself
Insurance is going up due to demand by health insurance executives of higher bonuses, hospitals raise their rates because they must make up the loss by uninsured, pharmaceutical companies increase their prices due to Bush lack of control which is in effect by the VA and finally longevity makes prone to more complicated treatment. The latter should be easy to remedy apply the survival of fittest or triage by age and ignore the problem
Of course the Obamacare would have the ooposite effect since the claim ratio would be distributed among a larger group .
Lets review where we were before Hilary’s concept of Universal coverage and the great concept of “HMO’s”. Lets see, Doctors were actually in control of healthcare and pharmacology, not insurance companies. Doctors actually accepted assignment. Insurance companies were begging you for your business and their rates were reasonable compared to now, with much lower deductibles and automatic 80% returns on pharmacy and visits. No questions asked.
Doctors actually took the time to speak to their patients. Sick people went to doctors and NOT emergency rooms, and did what their doctors told them to do, not what their insurance companies told them to do. People didn’t run to the doctor unless they were sick because they didn’t want to pay the 20%, the deductible, or be bothered with the long wait or the tests they would be put through.
The Doctors made money, the Insurance companies made money, and the patients were happy. There was no such thing as a Doctor NOT taking insurance because it had nothing to do with the Doctor, it had everything to do with the patient. So you saw any doctor you chose that you could afford and you could get in to. cont.
cont.
Now doctors don’t want to accept insurance, so the best doctors still have many patients, they charge high fees and THEY are still making money. People’s healthcare are determined by employees of an Insurance company who’s job is to watch their bottom line. More and more or the biggest Insurance companies have gone under or gone the medicaid route. What happened to The Guardian and United Healthcare? Blue Cross used to be the cream of the crop. Big joke now. New born babies are thrown out of the hospital along with their mothers after 24 – 48 hours of birth. Post-op patients walk out the front door of a hospital the same day as they were cut open. They don’t even stay overnight to watch the wound and make sure there is no fever, infection or bad reaction to medication.
Why, to save money for the Insurance companies. Procedures are denied, medications are denied, treatments are denied based on age and stage of illness. People suffer needlessly because it does not justify the bottom line.
This is what happened with the “GREAT IDEA” and now another GREAT idea is going to be forced upon us. EVERYONE is going to be forced to pay for something they can’t afford.
Time to go socialized!!! Now before all you turkeys start gobbling about the detriments of socialized medicine, go on Forbes, and see where the socilaized nations stack up in terms of the healthiest nations in the world, and then see where the USA stands. If you’re too full of stuffing to do it, I will tell you. The top 10 are socialized, I.E. Germany, Canada, Australia, etc. The US is number 11. Freaking israel with all the smoking and stress, is number 12. Yup, israel is socialized. So put that in your cranberry sauce, and indulge………..
Did anybody figure how anyone is supposed to pay for this>>
The “free market” has established certain remunerative norms for services. An engineer earns more than a cook because the engineer has completed some required academic norms. In medical care too we have estblished “free market” what is reasonable and what is unreasonable.The question is , is medical care the same as Hedge Fund mangement or is it a profession with some public obligation. There are public obligation implicit by the Hippocratic oath and various state agencies and medical associations have establishe regulations and fines such as removal of license. However when one uses medical knowledge to make millions on sick people you should maybe go in real estate, currency trading or other wild west financial services. The fact is a physiciann has an obligation to heal not only the wealthy but the poor too. To all you right thinking anti-Hussein Obamacare proponents . The neshomo of the poor comes from the same source than yours uppper crust well endowed and fat slobs
Electrical devices carry a UL listing and we need an equal listing on health insurance policies to assure the public that the exclusionary clauses are transparent and what is promised will be paid