An insurer in Washington state selling plans under the
Affordable Care Act is proposing to lower customers" health
premiums next year in what appears to be one of the first such
decreases proposed for 2015.
The proposal by Molina Healthcare Inc. was part of a batch of
state rate filings released Monday that included Washington and
Indiana.
While most carriers are seeking increases, Molina's filing
signals that insurers that priced cautiously for 2014 could face
pressure to be more competitive in the second full year of the
law's insurance marketplaces.
Molina proposed a decrease averaging 6.8% for Washington
customers for 2015. It told state regulators in its rate filing
that it was betting that people signing up through the insurance
exchange were in better health than the carrier previously thought,
and that it anticipated new entrants when the law's penalties for
not carrying coverage grow next year.
Molina, a company that historically has focused on managed
Medicaid plans, offered some of the most expensive premiums among
insurers selling on the Washington exchange in this year. It said
it had only about 1,200 members in 2014.
Ben Lynam, vice president for Molina's actuarial pricing, said
in an interview that the company had made conservative assumptions
for 2014 about the medical claims likely to be incurred by its
enrollees, in part because it hadn't had much previous commercial
experience.
"With hindsight and looking at what's going on across the
country...we've improved those assumptions and lowered our rates in
2015," he said.
In Washington, filings available Monday included proposed
increases ranging from 0.57% from Kaiser Foundation Health Plan of
the Northwest to an 11.2% boost by Group Health Cooperative, which
had some of the lowest rates in the state for 2014.
Insurers have said they faced considerable uncertainty about the
law's impact heading into 2014, and over time, plans with prices
that are both high and low outliers are expected to move toward the
middle.
At least two new carriers also appeared to have filed paperwork
to participate in the insurance exchange in Washington next year,
including United HealthCare, which had decided to sit out exchanges
in many states this year.
Kaiser, Group Health and United HealthCare didn't immediately
respond to requests for comment.
Washington is one of the 14 states running its own insurance
exchanges, and has had few of the technical problems encountered by
many other states.
Washington officials said they hit their first-year enrollment
targets, although data suggest that only about 26% of those signing
up were among the coveted 18-to-34-year old demographic.
In Indiana, Anthem Insurance Cos., a unit of WellPoint Inc.,
proposed an average rate increase of 9.65% for about 29,000
enrollees.
The premium proposals are subject to approval by the state
regulator and could change.
Write to Louise Radnofsky at louise.radnofsky@wsj.com
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