health care

Insurers in Tennessee Planned To Raise Premiums 29 Percent in 2017, But Now Are Asking For Even Higher Rates

Thanks, Obamacare.

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Ingram Publishing/Newscom

Under pressure from insurance companies, regulators in Tennessee have decided to give insurers until Friday to refile premium rate requests for next year.

That's probably bad news for anyone in Tennesee planning to buy health insurance through the Obamacare exchanges next year. When big insurers like Cigna and Humana filed their rate requests in June, they asked to increase premiums by between 23 percent and 29 percent, but those same insurers now say those requests were too low and will be looking to raise them, The Tennessean reports this week.

Regulators were convinced to reopen the filing period because Cigna and Humma threatened to pull out of Tennessee's Obamacare exchange unless they could hike their rates.

"In an effort to balance affordability and availability, the department will allow insurers to refile rate requests on the marketplace in order to prevent possible withdrawal," Kevin Walters, spokesman for the department, told The Tennessean.

BlueCross BlueShield, the other major insurer in Tennessee, asked for a 62 percent rate hike when it filed with the state Department of Commerce and Insurance in June. That probably gives you some idea of what the new rate requests from Cigna and Humana will be.

"This whole idea of 'if you like your plan you can keep your plan' is just turning out to be completely false," says Justin Owen, CEO of the Beacon Center of Tennessee, a think tank based in Nashville.

In an interview on Thursday, Owen said Tennesseans should be bracing for a big hit when premiums for 2017 are finally settled and criticized the Affordable Care Act for prioritizing insurance coverage over health care outcomes.

It's not just Tennessee, of course. Other states are seeing similar, massive rate hikes for 2017 as insurers struggle to cover the cost of medical claims. People getting insurance through the Obamacare exchanges have proven to be costlier than expected and regulations contained in the Affordable Care Act mandate insurers provider coverage for a wider range of care than many people actually need.

Those higher costs are forcing some insurers to raise premiums and causing some insurers to consider pulling out entirely. Aetna, a major insurer active on 15 state exchanges, has lost $200 million this year and company CEO Mark Bertolini said this week that it's reconsidering whether to continue offering Obamacare plans.

Sure, health insurance companies make lots of money and it's tempting to suggest—as Michael Hiltzik of the Los Angeles Times did this week—that the government should play "hard ball" with them and refuse to allow such massive premium hikes. But government regulators can't do that unless they want to see the entire exchange model collapse around them.

We've already seen what happens when you try to provide health insurance without letting the insurers make a profit. That was the theoretical goal of the health insurance co-ops created by the Affordable Care Act, and what has happened to them? Nothing good—and also nothing that should have surprised anyone who looked at how they were set up.

United Health, another major national insurer, has already left most of the exchanges and Humana has pulled out of some as well. The companies staying in are asking for huge premium increases—as BlueCross BlueShield did in Tennessee.

They're likely to be approved because regulators like the Tennessee Department of Commerce and Insurance are stuck between a rock and a hard place. They have to accept massive premium increases from insurers and foist that onto the people of their state, or they have to watch as more insurers follow United Health out the door.

Higher premiums aren't good news for anyone, but Owen points out something that might reasonably be called a silver lining. The coming premium hikes might encourage more doctors and patients to test out new alternatives to health insurance, like Tennessee's recent expansion of direct care arrangements.

Under provisions approved by the Tennessee legislature earlier this year, health care providers can contract directly with patients to provide basic care. Individuals and families pay a fixed monthly fee—perhaps $75—to the health care provider for access to office visits and other basic services, essentially cutting insurance companies out of the arrangement. Direct care allows patients to carry a cheaper, high deductible health insurance plan for catastrophic medical needs while paying out-of-pocket for routine visits.

It's also better for doctors' offices, which don't have to haggle with insurance companies over reimbursements and billing claims.

Some doctors in Tennessee already offered this arrangement, but legislation passed in April makes it clear that direct care contracts cannot be subjected to the same regulations as health insurance plans. In other states, doctors who have offered direct care contracts have been surprised to find they were suddenly considered to be an insurance company by state regulators.

By letting people pay for only the health care they use, advocates for the direct care model say it's essentially a market-based solution to some of the problems created—or at least made worse—by the Affordable Care Act, says Owen.

"We have to do everything we can to give patients more options, particularly in the face of these massive increases in health insurance costs," he said.

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  1. And the cost curve is getting bent, just not the way we were told it would be.

    1. “We agree on reforms that will finally reduce the costs of health care,” Obama said. “Families will save on their premiums; businesses that will see their costs rise if we do nothing will save money now and in the future. This plan will strengthen Medicare and extend the life of that program. And because it gets rid of the waste and inefficiencies in our health care system, this will be the largest deficit reduction plan in over a decade.

      “Now, I just want to repeat this because there’s so much misinformation about the cost issue here. You talk to every health care economist out there and they will tell you that whatever ideas are — whatever ideas exist in terms of bending the cost curve and starting to reduce costs for families, businesses, and government, those elements are in this bill.”

      – B. Obama, 12/15/09

      The more cynical among us will say that things are right on schedule, as they were always meant to be, and that the Lefties will use this latest example of greedy corporations to push for single payer.

      1. Remind them that the ACA is literally already single payer healthcare given that everyone pays into the system one way or another, and also remind them that the VA is also single payer and we already know for a fact what that system looks like.

        As a bonus, make sure to point out that Bernie Sanders was in charge of that train wreck.

  2. But just think of all the people who couldn’t afford it before who now have access to unaffordable health insurance!

  3. This whole idea of ‘if you like your plan you can keep your plan’ is just turning out to be completely false,”

    “turning out” to be false? Uh, this wasn’t true when it was said originally and was never going to be true. Neither were the Obama promises to “Lower Health Insurance Premiums by $2,500 Per Year” or “If you like your doctor you can keep your Doctor”

    Pretty much every goddamned thing Obama and his administration claimed about this disaster was a lie from day one and continues to be so to this day.

    1. HOW MANY PINOCCHIOS DOES IT RATE? WHAT DOES SNOPES SAY?

    2. Its worse than that, Tman. It was categorically false when stated, because many of the plans were going to have to be changed to comply with ObamaCare. If the plan you have changes, then you didn’t get to keep your old plan, did you?

      After OCare, very few people had the same plan that they had before OCare. And this was basically mandated by the law, so it was a lie when stated.

      1. I’m with you RC, I just said that above “this wasn’t true when it was said originally “.

        And I remember back then when it was discussed it here as being complete bullshit and the usual Tony and Shreeks came out and said otherwise, how we were going to be proven wrong, how everyone would be rainbows and roses etc.

        Consequences: Intended.

        1. I’m used to people saying it was a lie because they don’t still have their old plan, but not quite grokking that under no possible circumstances were they ever going to keep their old plan, because their old benefits package was rendered non-compliant (unless by some miracle it already complied with the new mandates, and that’s a unicorn I’ve never seen).

          And no, the grandfathering in the law doesn’t make this not a lie, because you would lose your grandfathering if any changes whatsoever were made in your old plan. And very few if any benefits plans don’t have changes year to year, often because, wait for it, those changes are legally required.

  4. I clearly remember Obama saying something like, “If you like being fucked in the ass with a prickly pear cactus, you can continue to get fucked in the ass.”

  5. Thanks, voter fraud!

  6. A flaming bag of shit left on the doorstep of the WH for POTUS45. Choom baby! Choom!

  7. What do I care, so long as I can keep my doctor?

  8. Eric (if you’ve suited up in your hazmat to visit the commentariat), the one mystery of ObamaCare that I can’t seem to find an answer to is this:

    What’s the net change in the number of people with private health insurance since ObamaCare was passed? Of the increase, how many got that insurance through an employer (meaning, hard to attribute to ObamaCare)? The real number I’m try to get to is what, if any, has been in the increase in people with private health insurance due to ObamaCare.

    The numbers that are periodically published to tout the success of ObamaCare generally put private insurance and the Medicaid expansion in the same bucket, which is bullshit, because Medicaid isn’t insurance, its welfare. Those numbers also get a lift due to the recovery (anemic though it is), so by the time you net those out, what’s left?

    1. Those numbers also get a lift due to the recovery (anemic though it is), so by the time you net those out, what’s left?

      Matriculation of those going from private insurerers to Medicare (CMS, but still “insurance”) via age 65 requirement, and a glut of folks on SSI/Disability (AKA, “Early Medicare, also an “insurance” metric).

      The real number I’m try to get to is what, if any, has been in the increase in people with private health insurance due to ObamaCare.

      You and just about every other actuarial wonk in the field, RC. And, there has (and there hasn’t) depending upon what population distribution one uses, since a number of them intersect and overlap at some point, a la, “26 year old children,” and illegal immigrants who may qualify for subsidies via identity fraud, for examples.

      Basically, Medicare is being considered as “insurance”, as when you reduce the seasoned citizen contingent from the privately insured population, you get to increase that percentage of privately insured and call it a success. All the while double dipping those numbers with the Medicare “insured” population. But in actuality, the percentage of individual (not counting 26 year old “children”) private policies issued has remained relatively static with maybe a marginal increase at best.

      It’s a semantic shell game, RC, including ALL of CMS, not just Medicaid, and because of that, the numbers are fluid.

      1. Not to mention, it’s illegal NOT to have insurance.

        1. it’s illegal NOT to have insurance.

          Meh. That one is largely a nothingburger; USA rates of ER/ED encounters has dramatically spiked in the last few years; people are still getting care, whether they pay for it or not. The only people that illegal thing hits are families not on CMS of some kind, and most everyone qualifies for a subsidy. Single/Unmarried can still, for the most part, shoulder the Penaltax.

          There are still a slew of “uninsured” who have opted to remain that way (until the Penaltax dwarfs what it would cost for an actual policy). Or they just aren’t quite disabled enough for SSI, and still others opt for relying entirely on UrgentCare centres until TSHTF.

      2. Dr. G! Was just looking for you in another thread, for this:

        http://endingthefed.com/hole-i…..itter.html

        Bonus before and after shots of her tongue. Its clear something was removed from it.

        Paging Dr. Groovus. First time I had seen a before picture of some kind of . . . growth on her tongue.

      3. It’s a semantic shell game,

        I know. That’s why I’m hoping somebody would do the spadework necessary to untangle it. Perhaps a paid reporter for a libertarian publication.

  9. I like in Tennessee and my letter from Blue Cross said to expect a 46% increase first of the year. That would be on top of last years 24%.
    And NO I was NOT allowed to keep my old plan. My old plan had sane deductibles and co-pays, with cheap generic drug prices. Now I am basically self insured for the first ten grand or so with zero prescription coverage, and paying far more for less.
    He lied.

    1. The good news, Bill, is that you now have coverage for pregnancy and birth control.

      1. Meanwhile, here’s a silver-platter issue that’s negatively affected the vast majority of Americans and should be something a Republican candidate for President could easily highlight to gain countless votes.

        What’s that? He’s too busy arguing on Twitter with some Muslim guy? Oh well.

      2. For the first TEN GRAND!

    2. I felt your pain my employee provided coverage went from reasonable everything to reasonable premium with absurd deductibles, high out of pocket max and full price prescription until the deductible is met. Which never happens because at most I spend $1000 towards health care a year. Luckily my wife got a new job with a tech company that has amazing insurance… until the caddy tax comes.

      1. For $1,000 you get one visit to the ER if you have a bad tummy ache that turns out to be bad clams and not appendicitis.

  10. Not only did Obamacare bring unafordable insurance to the poor it made employee provided insurance unafordable. If the poor can’t be happy no one can.

  11. Even when reviewed in the most generous light, it is an abject failure. The problem, so we were told, was 2 fold. 44 million uninsured and double digit premium increases. Fast forward 6 years. The double digit premium increases have continued and the uninsured is around 30 million or so.

    If the plan in 2010 was “We’re going to fuck up the health insurance market so we can insure 10 million people”, this thing wouldn’t have gotten a serious look by anybody except the idiots at MSNBC.

    1. Weren’t the double digit increases before Obamacare in the 10-12% range?

  12. The things I want to say about this would probably get me subpoenaed, so I’m going to restrain myself.

  13. Government is bad at simple stuff like policing, but bound to be great at really hard stuff like healthcare.

    /progderp

  14. Sure, health insurance companies make lots of money

    Yeah they’re making money hand over fist with profit margins worse than a common bacon and eggs restaurant…. (which is low)

  15. Higher premiums aren’t good news for anyone, but Owen points out something that might reasonably be called a silver lining. The coming premium hikes might encourage more doctors and patients to test out new alternatives to health insurance, like Tennessee’s recent expansion of direct care arrangements.

    I’m sorry, but I thought the law required purchasing insurance.

    If that hasn’t changed, then even though I’d love to see more people pay more directly for healthcare, the solution offered here is: buy required insurance and don’t use it because it sucks and instead pay for healthcare directly.

    This seems to only work in the government’s favor, while screwing everyone else as they continue to receive premiums, but fewer will use their insurance, yet still be paying.

    I’m sure this is considered a feature and not a bug by Obama, Hillary, O-Care supporters, and other socialist/authoritarian/idiots…but the net result of this would be to remove the responsibility to fix this away from the government and to the people.

    A situation which would normally bring me glee, however since the problem is caused by horrible legislation, the government will have to be involved in removing it.

    And this solution of direct buying seems to decrease the likelihood of that ever happening.

  16. There’s absolutely no doubt that since the changeover my health care:

    a) Has become more expensive
    b) Covers less stuff I actually use
    c) Has forced me to change plans twice as the first two fled the state (at the very least, maybe they shut down altogether; I haven’t checked)

    Whether in aggregate it’s true or not, I don’t know. But in my specific case, OBC hasn’t done me much good.

  17. I can’t make any great comment on this subject since my primary care physician is the random intern, I mean flight surgeon, that looks my symptoms up on webMD and then prescribes me Motrin.

    However, I would get a kick out of reading AmSoc or Tony spin this as a red state problem and Boooooshhhh.

  18. Just about every time any one these stories appears about the huge premium increases on any website, leftist twits start posting comments claiming that their personal insurance hasn’t gone up that much, the increases are no greater than they were before the ACA was enacted, low income people get tax credits to offset the premiums and claim all those pre-existing cheaper policies were “substandard”

    I have seen the same type post so many times there must have been a master script written and saved someplace that these idiots just copy and paste from.

    1. Absolutely, that’s what they’ve been told by their betters and they’re way too busy to see if any of it is actually true. No doubt zero of them actually work anywhere in healthcare either.

  19. I’m really enjoying these higher premiums, losing my doctor, being limited in choice, and receiving a letter saying my premium will be going up yet again.

    The Austrian economists, most everyone on here (except for the douchebags that supported the law…you know who you are and can go fuck yourselves) have predicted what will happen…..that being higher premiums, limited choices, and even a road to single payer. As the supporters of this law will never admit gov’t is a failure, and will push for more control.

  20. May be company is trying to achieve something. Still it is a bad news
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  21. That’s really cool. I would be interested in seeing more graphs of different information you pull from these logs.
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