CAPITAL REGION — Health insurance open enrollment begins Thursday, and insurers have rolled out new options in hopes of drawing new subscribers and retaining existing members.
For the most part, premiums charged by Capital Region-based insurers will show small increases or even decreases for individual and small-group policies.
The small rate increases allowed by state regulators — less than the rate of inflation in some cases — follow years of increases well in excess of the inflation rate, which means that insurers have to watch expenses as they try to attract and retain subscribers.
For Schenectady-based MVP Health Care, with more than 700,000 members in New York and Vermont, this has meant promoting the telemedicine service it rolled out in 2017 and enhancing its outreach efforts to identify gaps in its members’ health care — both of which would reduce the costs of care. MVP also offers a wide array of Medicare Advantage plans for the older segment of the market, which is growing.
Vice President of Sales Kelly Smith said MVP also continues to focus effort on the smallest segment of its business, individual policies for self-insured people.
“We were one of the early adopters in the individual market,” she said. “We continue to invest in the individual market year after year — it lines up with our mission.”
With advances in technology, Albany-based CDPHP has begun offering hyper-personalized plans based on the medical histories of individual members, spokeswoman Ali Skinner said.
“It’s really come to fruition in the last three to five years,” she said. “We’re really sitting on a mine of data, so we’re using that data.”
Also, CDPHP will start offering its 365,000 members mental health consultation through its Doctor on Demand telemedicine service and add incentives for healthy living such as free or reduced-cost gym membership. These and other steps will make health care less expensive and/or less necessary, which is important for CDPHP: It sought rate hikes of 5.1 percent to 6.7 percent and the state allowed it no more than 1.5 percent.
Latham-based BlueShield of Northeastern New York did not seek increases for the 2019 premiums for individual and small-group policies covering its 200,000 members.
With a big rate hike in 2018, revenue was higher than expected and costs were trending lower in 2019. So BlueShield proposed small rate reductions, said Tom Sass, director of consumer markets.
For this open enrollment season, he said BlueShield is pitching zero-dollar premium Medicare Advantage plans and out-of-network coverage, which is important to people who spend the winter out of state or live close to the New York border and want to see a doctor in another state.
BlueShield also highlights its physical presence in the region, with counselors available in person to area residents, unlike some of its national competitors.
“We pride ourselves in saying members can call us up,” Sass said. “These are things that because we are local, that’s a key differentiator for us.”
Open enrollment began Oct. 15 and ends Dec. 7 for Medicare coverage. In New York, it runs Nov. 1 through Jan. 31 for individual market plans.
New York state places numerous mandates on health insurers operating here, and the state Department of Financial Services regulates what they charge for insurance.
When it announced the approved rate hikes in August, the DFS noted that it had reduced insurers’ requested rate hikes by 64 percent for individual policies and 50 percent for small group policies, saving consumers $314 million and small businesses $279 million, respectively.
Financial Services Superintendent Maria T. Vullo said in an August news release that the Trump administration’s efforts to undo the Affordable Care Act (popularly known as Obamacare) prompted some insurers to request large rate hikes in anticipation of higher costs, and DFS had rejected that.
“DFS has carefully examined the rates requested by health insurers and scrutinized every factor from an actuarial and market standpoint to ensure that the Trump administration’s many efforts to sabotage affordable and comprehensive healthcare coverage do not allow insurers to unfairly profit at the expense of consumers.”
Individual health insurance plans cover about 330,000 New Yorkers; small group plans (for employers with one to 100 employees) cover a little more than 1 million New Yorkers; and large group plans (for workplaces with more than 100 employees) cover about 2.5 million New Yorkers.
The state regulates the cost of large group plans differently than smaller group and individual plans. Large-group plans are mostly experience-rated, which means their premiums are based on the medical history — the experiences — of their subscribers. So two neighboring workplaces with 250 insured employees each could have very different premiums if one has substantially healthier employees than the other.
Instead of approving rates for large-group plans, the DFS approves the formula by which the insurer calculates the rate.
The following chart shows the health insurance rate changes approved for 2019 by the state Department of Financial Services; insurers with very small market share are excluded from the list. From left to right are the requested/approved rate changes for 2019 and the approved rate changes for 2018, 2017 and 2016:
- CDPHP 5.1%/-1.9% 15.2% 13.9% 2.5%
- Emblem 31.5%/17.0% 21.5% NA 10.5%
- Empire Healthchoice Assurance 24.0%/0.0% NA 15.2% 13.2%
- Excellus 8.9%/4.6% 4.4% 15.4% 5.7%
- Fidelis 38.6%/13.7% 10.2% 11.6% 4.7%
- Healthfirst PHSP 15.0%/9.5% 17.7% 7.4% 9.6%
- BlueShield NENY/BlueCross Blue Shield WNY -3.2%/-3.2% 31.5% 8.7% -1.3%
- IHBC 21.3%/0.6% 22.3% 19.6% -10.4%
- MetroPlus 13.5%/13.5% 7.1% 29.2% -7.0%
- MVP Health Plan 6.5%/1.9% 14.4% 6.0% 10.2%
- Oscar 25.2%/11.0% 11.4% 19.6% 4.54%
- UnitedHealthcare of NY 23.6%/1.5% 20.0% 28.0% 1.7%
- Weighted average: 24.0%/8.6% 14.5% 16.6% 7.1%
Small group market
- Aetna Life 16.2%/7.9% 9.1% 8.4% 21.5%
- CDPHP 6.7%/0.0% 20.4% 18.5% -19.8%
- CDPHP UBI 6.1%/1.5% 9.0% 9.5% 16.6%
- Emblem 12.0%/9.8% 8.1% NA 29.7%
- Empire Healthchoice Assurance 6.0%/5.0% 9.8% 9.3% 3.4%
- Excellus 3.8%/3.8% 8.9% 10.7% 10.0%
- Healthfirst Insurance Co. 7.0%/6.4% 4.9% 6.8% NA
- BlueShield NENY/BlueCross Blue Shield WNY -0.1%/0.3% 8.6% 10.4% 0.7%
- IHBC 3.8%/4.7% 13.9% 11.5% -6.2%
- MVP Health Services Corp. 10.3%/9.1% 12.6% 6.7% 15.9%
- Oscar 3.0%/2.0% -3.2% NA NA
- Oxford Health Insurance 8.3%/3.0% 8.1% 5.6% 6.8%
- Weighted average: 7.5%/3.8% 9.3% 8.3% 9.8%
According to the state Department of Financial Services, the largest portions of health insurance reimbursement are:
- Medications 28%
- Inpatient hospitalization 19%
- Specialist physicians 11%
- Diagnostic procedures 10%
- Ambulatory surgery 9%