Mississippi: Rates to fall by 25% & increase 6.5% respectively (UPDATED)
This is the third 2015 rate change update today; I had already reported on the 25% drop on one of the companies operating on Mississippi's exchange a few weeks ago, but this makes it official, and also reveals that the 2nd provider (there's only 2 on MS's exchange) is only requesting to raise their rates by 6.5%:
Health insurance rates for one company on Mississippi's insurance exchange will fall by 25-percent according to Insurance Commissioner Mike Chaney.
The falling rates could be a sign that the exchange is working as it heads into the second year of enrollment.
Insurance Commissioner Chaney says Magonlias health Plans over-estimated its rates for the first open enrollment period and is now seeking to decrease its premiums by one-fourth, which could be the biggest decline in the country.
Mississippi entered the first year with the second highest rates in the nation due in part of poor provider networks and a lack of competition.
Chaney says the other company, Humana, has filed to increase rates by 6-and-a-half percent which will close the gap between the two companies and bring them more closely in line with the rest of the country.
This isn't a weighted average, but the worst-case scenario is a 6.5% increase, and that's only if Humana somehow wrangled 100% of the enrollments last year, which I presume isn't the case.
UPDATE: Contributor Esther H. points out this story in the Clarion-Ledger from late June which gives Humana's either 73% or 82% of the total (depending on whether their 45K figure is out of 62,000 total or 55,000 paid enrollments).
Not that it makes that much difference, but assuming the 73% figure, that suggests that the weighted average would be:
- 73% x 6.5% = 0.04745
- 27% x -25% = -0.0675
Add them up and Mississippi's weighted average appears to be roughly a 2% decrease...which also sounds about right since the article specifically states that the 25% drop & 6.5% increase will "close the gap" between the two anyway.