Insurance Department OKs Health Net’s Plan To Increase Premium Rates
On Tuesday, the California Department of Insurance approved Health Net's proposal to increase premiums by an average of 16% for about 38,000 policyholders who purchase insurance on their own, the Los Angeles Times reports.
Rate Hike Details
The higher rates are scheduled to take effect on Oct. 1. The insurer had delayed the increases for three months, while the state reviewed its paperwork. Health Net would not reveal how long the higher rates would be in place (Helfand, Los Angeles Times, 9/8).
Increases will range from 8% to 24%, depending on the specific plan purchased by policyholders, according to Health Net's rate filing (Calvan, Sacramento Bee, 9/7).
Health Net welcomed the state's approval and said the higher rates stem from the rising costs of hospitalizations, physician visits, medication and other health care services.
State Approves, Not Supports
Ioannis Kazanis, spokesperson for California's Insurance Department, said the state neither endorses nor supports Health Net's rate hikes but found the insurer's filing to be in compliance with California law.
The state weighed whether Health Net's proposal would allocate at least 70% of the premiums it collects to policyholders' medical care, as mandated under state law.
Other Premium Increases
Approval of Health Net's premium increases comes less than two weeks after the state Insurance Department approved rate hikes by Anthem Blue Cross and Blue Shield of California (Los Angeles Times, 9/8).
Anthem's initial rate proposal would have increased premiums by as much as 39%. However, an external actuary found numerous mathematical errors with Anthem's rate filing, so the company resubmitted its proposal with substantially lower rate increases (Sacramento Bee, 9/7).
The same external actuary, Axene Health Partners, reviewed Health Net's rate filing and found that theirÂ proposal met state regulations (Colliver, "Chron Rx," San Francisco Chronicle, 9/7).
Meanwhile, Aetna has proposed raisingÂ premiums by an average of 19% starting Oct. 1. Although theÂ insurer began sending notifications about the rate hikesÂ to 65,000 California policyholders last week,Â Aetna still is awaiting the state's decision on whether it can move forward with the planned premium increases (Los Angeles Times, 9/8).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.