With health insurance premiums set to increase in Arkansas next year in the wake of carrier exits from the federal marketplace, the state’s insurance commissioner worries that the rates will only increase further in 2018.
On Aug. 22, the Arkansas Insurance Department submitted health insurance rate hike requests to the Health Reform Legislative Task Force for review, local public radio station KUAR
According to the department, premium rates for next year will increase on average by 9.1% across all plans from all carriers. Notably, Arkansas Blue Cross Blue Shield originally submitted a rate increase request of 14.7%, but officials have dialed it down to a more appropriate 9.7%.
While changes were made to the rate increases to make them more “palatable” to the interests of both consumers and their insurers, state Insurance Commissioner Alan Kerr believes that lowering the rate increases for 2017 simply pushes the difference on to the following year’s rate adjustments.
“Whatever rate we don’t take this year, if we make no changes at all, no course corrections at all, then yes we’re looking probably at a larger rate increase next year,” Kerr remarked. “We may be putting this off for another year. What that does is give us something that’s palatable and affordable for the next 12 months while we make course collections.”
Despite this, Kerr emphasized that Arkansas’ rates are still generally below those requested in other states.
“Alabama is looking at a 39.3% increase, Mississippi 32% increase, Missouri 34%, Tennessee 54, and Texas 57. There’s a lot of activity going on around us,” he pointed out.
Kerr was criticized for this statement, most notably by State Senator Linda Chesterfield (D-Little Rock).
“It would stand to reason that if you had a quarter-million people who never had health insurance that the cost of health insurance would go up,” Chesterfield explained. “Would that be a correct assessment Mr. Kerr?”
“Historically, as we’ve seen that last three years, yes,” Kerr replied.
“If I’ve never had health insurance before and I get to go the doctor for the first time ever with diseases and conditions that have festered, costs are going to go up,” Chesterfield said. “If however, I stay with that doctor for a period of time. Should not the cost of care begin to go down because the initial cause is invariably higher than costs that come after? Does that make sense to you?”
“When you first go in to evaluate you’re going to have to run tests and so forth,” Kerr replied. “Once they have that baseline, it’s a maintenance situation from that point on. I call in deferred maintenance.”
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