Rhode Island: APPROVED avg. unsubsidized 2024 #ACA rate changes: +7.8%

Thu, 09/12/2024 - 8:01pm

I got so far behind on my annual rate filing project that some of the states have started issuing their APPROVED changes before I got around to analyzing the REQUESTED rate changes. Ah, well...

Via the Rhode Island Insurance Department:

2025 Commercial Health Insurance Rates Have Been Approved with Modifications

CRANSTON, R.I. (September 3, 2024)

Commercial health insurance premiums for 2025 have been approved by the State of Rhode Island’s Office of the Health Insurance Commissioner (OHIC), with modifications. As a result of these changes, Rhode Islanders will save $29.6 million in 2025 compared to what the commercial health insurers requested. In the months since the rate filings were submitted in May, OHIC has reviewed the medical and pharmacy expense trend assumptions, administrative charges, and margin requests for each insurer. Additionally, OHIC staff reviewed the benefit coverage documents for each health plan to ensure compliance with state and federal laws. The premiums approved by OHIC are predominantly driven by payments to health care providers and drug costs, due to increasing unit prices and use of health care goods and services.

The approved rates do not apply to self-funded employer groups that account for approximately 65% of Rhode Islanders with employer-sponsored coverage. Self-funded employers pay the health care expenses of their employees and dependents directly, commonly relying on health insurance companies for administrative services, such as member enrollment, provider contracting, and claims processing.

In addition to OHIC’s review, the Rhode Island Attorney General’s Office (RIAG) conducted an independent review of the rate filings across all markets. The RIAG submitted comments and actuarial reports with recommendations on each rate filing to OHIC, consistent with the practice of years past. The RIAG actuarial reports are posted on the OHIC website for the public to review. The RIAG also participated in the BCBSRI individual market rate hearing in July.

Tables 1 – 3, below, summarize the approved rates for 2025 and the enrollment with each insurer, by market, as of March 2024. The rate change approved by OHIC is shown along with the recommendations from the RIAG’s consulting actuary, and the rate change requested by the insurers in the May filings. Overall, the OHIC approved weighted average rate changes are 7.8% for the individual market, 12.4% for the small group market, and 11.2% for the large group market. To lower rates, OHIC reduced medical trend and severity assumptions, rejected insurer administrative cost increases that exceeded the rate of inflation, and modified insurer requested margin.