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Health insurance providers are seeking an average rate increase of 18.7% next year for individuals and 16.5% for small group plans, state records show.
The proposed insurance premium rate hikes exceeded recent years. Insurers cited, in part, the ongoing health-related costs of COVID-19 and inflation as reasons for seeking the rate increases.
The changes would impact millions of New Yorkers who are enrolled in individual and small group plans directly through private insurers or through the state’s health exchange, NY State of Health.
Now, the state Department of Financial Services, which regulates insurers, will review the rate proposals and consider adjustments before finalizing the 2023 rates in August. Historically, the state agency has significantly reduced the rates from those sought by insurers.
Last year, for example, regulators approved average rate increases of 3.7% for individuals and 7.6% for small group plans. That was down from the 11.2% and 14%, respectively, sought by insurers.
Still, the higher-than-usual insurance rate increases sought for 2023 joined the growing list of cost increases currently hitting New Yorkers struggling with historically high prices for everything from food and gasoline to housing.
Eric Linzer, president and CEO of the state Health Plan Association, which represents insurers, asserted inflation and pandemic-related costs have joined the long-standing issues of rising drug prices and health care costs to drive up rates.
“Health insurance premiums are directly tied to the underlying cost of care, and the continued growth in health care costs further add to premiums,” he said in a statement.
Some of the COVID-19 issues impacting insurers included the cost of testing, treatment and vaccines. An influx of New Yorkers now seeking care deferred earlier in the pandemic is another factor driving up costs, the insurer trade group noted.
Linzer urged regulators to ensure the final approved insurance rates for next year “fully reflect the factors contributing to the growth in health care costs,” and avoid negatively impacting health plan’s efforts to provide New Yorkers access to high-quality, affordable health care.
The insurance trade group also asserted reducing the premium rate requests could negatively impact programs seeking to reduce health inequities and improve the health and wellness of New Yorkers.
State regulators, however, have stated in recent years that their goal is to approval final insurance rates that account for both costs faced by health plans and the overall economic strains facing New Yorkers.
For further details about specific health plan’s rate increase requests, visit the state Department of Financial Services website at dfs.ny.gov, or call the agency’s hotline at (800) 342-3736.
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