The Arkansas Insurance Department recently shaved down some rate increase requests by health insurance companies in Arkansas, but that doesn’t mean bigger rate increases won’t be happening in the near future.
According to an Arkansas Insurance Department (AID) spokesman, Blue Cross Blue Shield’s increase request was reduced to 9.7 percent, QualChoice’s was reduced to 13.5 percent, and Ambetter’s was reduced to 4 percent.
These premium rate increases will go into effect in 2017 for approximately 260,000 enrollees on Medicaid expansion plans (and thus for the taxpayers who subsidize these plans) and approximately 60,000 people in the private insurance market in Arkansas.
Although the rate increases were just announced late last week, some legislators and bureaucrats are already worried that bigger rate increases could be coming in future years.
State Sen. Jim Hendren asked AID Commissioner Allen Kerr at a Health Care Legislative Task Force meeting today about the concern that “we were setting ourselves up for larger rate increase in 2018.”
If we make no course corrections at all, we’re probably looking at a larger rate increase next year. As a rule, Arkansas tends to move about a year behind the rest of the country in economic downturns and insurance rates. Yes, we may be putting this off for another year. What that does is it gives us something that’s affordable for the next 12 months while we make these course corrections and hopefully come up with a better plan.
An AID spokesman told The Arkansas Project today that the department had determined that the insurance companies could “absorb” a reduced rate increase despite the sentiments of Lewis & Ellis Inc. — a state-contracted actuarial firm — which previously said that BCBS’s rate request of 14.7 percent was “actuarially not unreasonable,” due to BCBS’s “poorer than expected experience” with Obamacare.