By Michael Bielawski
Blue Cross Blue Shield and MVP health insurance companies each are requesting that the state approve rate increases for the monthly premiums that people must pay to have health insurance.
As with recent years, the increases are substantial, and the companies are asking for ratepayers’ understanding.
“We understand the concerns individuals and small businesses have with these rising costs and will continue to work closely with stakeholders to bring solutions that will support all Vermonters,” states BCBS.
Blue Cross Blue Shield says that the average rate change for their proposal is 16.3 percent, according to the Blue Cross Blue Shield of Vermont 2025 Vermont QHP Market Rate Filings Actuarial Memorandum, which is linked here.
Their proposal states, “Changes for specific plans range from 8.5 percent to 21.5 percent for non-loaded plans and from 39.9 percent to 44.9 percent for loaded silver plans. The range of changes is due to changes to the actuarial values, plan designs, and the new guidance on silver loading, which increases the loaded silver plans by 20.8 percent and reduces the non-loaded plans by 2.1 percent.”
MVP has made a more modest proposal for their rate hike. Their Actuarial Memorandum 2025 Vermont Small Group Exchange Filing states, “The proposed average rate increase (MVP’s revenue increase) is 9.3%, with increases ranging from 5.2% to 11.7%.”
Healthcare utilization trends “too volatile”?
The MVP document hints that there may have been unusual trends in healthcare utilization in recent years. The report states that they, “analyzed historical medical utilization trends for its VT block of business and determined that the data has been too volatile in recent years to use for medical utilization trend purposes. MVP attributes this volatility to the significant membership growth for this block of business and COVID-19.”
The Blue Cross Blue Shield report similarly indicates that there are unexpected changes in healthcare utilization at play.
“In Vermont, and nationally, health care costs continue to grow year after year at a faster pace than many other economic indexes. Increases in the volume of services along with the costs of these services have put pressure on our member and group customers’ finances,” it states.
According to KFF, a health news and data site, medical expenses continue to be one of the top burdens on Americans’ expenses.
Their report states, “About four in ten adults (41%) in the United States—and about six in ten (57%) of those with household incomes below $40,000—have some level of medical debt, owing an estimated $195 billion or more in total. Many adults who report medical debt cite costs associated with emergency care (50%) and hospitalizations (35%) as sources of unpaid bills. Affording this care may be especially challenging for the large number of adults who are uninsured or underinsured.”
Charity Care a better alternative?
It is currently not a legal requirement that individuals have health insurance, though it is often packaged with many employment offerings. The law is that if someone does not have health insurance, they must be offered income-adjusted fees for essential services from healthcare providers that receive public funds. This is more commonly known as Charity Care.
According to a report at VeryWellHealth.com, “Charity care, also commonly referred to as uncompensated health care, is health care provided for free, or at a reduced cost, to people with limited income who would otherwise be unable to pay for their treatment.”
According to the KFF report, Charity Care represents a small percentage of overall healthcare budgets.
The report states, “Half of all hospitals reported that charity care costs represented 1.4% or less of their operating expenses in 2020, though the level of charity care varied substantially across facilities.”
The author is a writer for the Vermont Daily Chronicle