Tom Swan, Executive Director of CCAG Credit: File photo by Christine Stuart
Connecticut Citizens Action Group updated its report on insurance company benefits in anticipation of Monday’s hearing on proposed double-digit rate hikes by health insurance companies in the individual and small group market .
The report found that five of the companies looking to raise consumer rates by 2023 saw billions of dollars in profits, stock buybacks and executive compensation.
“As the state considers these requested rate hikes, it’s important to look at what insurance companies are doing with the dollars they collect from Connecticut residents,” said Tom Swan, executive director of the Connecticut Citizen Action Group. “Their greed is appalling. The health and well-being of their subscribers and the residents of Connecticut is the last thing on their mind.”
The report found that Anthem made $6.1 billion, CIGNA $5.36 billion, CVS, which is Aetna’s parent company, $7.9 billion and UnitedHealth made $17.3 billion in profits in 2021.
Anthem has bought back $1.9 billion, CIGNA $0.74 billion, and United Health has bought back $3.6 billion in stock, while their CEOs were handsomely compensated. Anthem’s CEO got $33 million in compensation, CIGNA’s CEO $91.1 million, CVS’s CEO $17.3 million and UnitedHealth $26.5 million.
All of the companies that want to raise consumer rates for plans starting in 2023 said they must raise their rates because the cost of providing health care has risen. They also cited the elimination of enhanced federal funding for subsidies for people participating in plans offered through Access Health CT.
U.S. Senator Richard Blumenthal is holding a press conference at 10 a.m. today to argue that the Inflation Reduction Act, which continues to fund these federal subsidies and is expected to pass the U.S. House today, eliminates the need for part of the augmentation. Because of the elimination of about $85 million in additional subsidies, companies expected consumers to leave the market.
A public hearing on the proposed fee increases will be held virtually at 9 a.m. Monday in the Legislative Office building.
ConnectiCare Benefits is proposing an average increase of 24.1% for its individual plans offered on the exchange.
The company argues that it is because the demand for services has increased. This factor is expected to have a projected 12.1% impact on the insurer’s claims costs, according to its filing. They also note that subsidies offered under the American Rescue Plan Act established in 2021 are expected to disappear in 2023. They say they expect fewer customers to qualify for the advanced premium tax credit and expect consumers leave the individual market. .
As a result of the departure of customers, the insurance company expects the average morbidity of the risk pool to increase and cause an unfavorable impact on the rates in 2023.
More than 75,000 people are covered by this plan. The company is also asking for a 23.6% increase for its individual over-the-counter plans. The company is also asking for a 22.9 percent increase for its small business plans on the exchange and a 24.5 percent increase for small group plans marketed outside of Access Health CT.
Anthem Health Benefits, the other insurer that offers plans on the Connecticut exchange, is asking for an average increase of 8.6 percent for its individual plans on the exchange.
The company says that about 9.2% of that increase can be attributed to medical cost inflation, provider hiring changes and increased demand for these medical services. Currently, the plan covers about 27,698 people.
Anthem is asking for an average increase of 3.6% in small group health plans for employers with 50 or fewer workers.
Cigna Health and Life Insurance Company filed to raise rates by an average of 19.64% on small group policies. Oxford Health Insurance asked for a 13.4 percent increase for health plans used by 50 or fewer workers and a 15.7 percent increase for HMO plans used by 50 or fewer workers.
Insurer UnitedHealthCare requested an average rate increase of 13.9% for small group plans. And Aetna Life Insurance Co. submitted a rate request for a 14.1 percent increase for small group indemnity plans that provide major medical and prescription drug coverage for employers with 50 or fewer employees.