Having previously received a 36.3% rate increase from state regulators last August, BlueCross BlueShield raised its rates yet again by 16%, according to reports by timesfreepress.com.
Company officials said that roughly 87% of its exchange members will receive some form of federal assistance with their insurance premiums.
The insurer initially offered some of the lowest rates on the health insurance exchange, but had underestimated how much it would need to cover for the many enrollees that had signed up.
“[The number of newly-insured policyholders that needed medical care] was three times what we had projected,” said vice president for corporate communications Roy Vaughn.
"We knew that we would get some sick people, but we just got more sick people than we expected, and they were sicker than expected," added vice president of product strategy and individual markets Kelly Paulk.
For this year, BlueCross posted 166,425 enrollees in Tennessee, compared to last year’s 143,000. The total number of Tennesseans who signed up for health insurance through the state exchange this year hit 268,867.
Paulk predicted that about 15% of enrollees would drop out as the year progresses due to changing circumstances, such as landing a job with health care.
Despite the increase and anticipated drop in enrollees, BlueCross is looking to raise its rates again later this year. Vaughn believes that the increase will likely be around the 30% range.
"Over the last two years, we have had $300 million in losses," Vaughn remarked. "That is not something we can sustain forever — we have to achieve a sustainable model. That's where we're focused."
The ACA promised participating insurance companies that a percentage of their losses would be repaid for the initial three years of the program. Budget cuts by Congress and structural oversights in the program, however, left the insurers waiting for their repayment to this day. Vaughn pointed out that BlueCross is due to receive about $200 million in reimbursements.
