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Blues seek hikes in premiums

By Jim Saunders
 2/25/2010 © Health News Florida

With health insurers nationally facing increased scrutiny about rate hikes, Blue Cross and Blue Shield of Florida is seeking double-digit increases for policies it sells to individuals and small businesses.

The state's largest insurer, which has filed three rate proposals with regulators during the past month, wants 11.2 percent increases for individuals who buy preferred-provider organization policies. Those in small-group plans would see average increases of 14 percent or more.

The increases are necessary because of soaring medical costs, said Randy Kammer, vice president of regulatory affairs and public policy for Blue Cross. She pointed to the millions of uninsured people in Florida, whose unpaid bills have forced hospitals and other health-care providers to shift costs to private health plans.

Kammer said Blue Cross recognizes how expensive coverage can be for small businesses.

"We are really, really trying to help our customers,'' she said.

Allen Douglas, Florida legislative-affairs director for the National Federation of Independent Business, called increases of 10 to 15 percent "fairly normal'' as small businesses have faced steady rate hikes in recent years.

"It (rate increases) is a complaint that we hear year in and year out,'' said Douglas, who has worked on insurance issues for the small-business group.

Blue Cross' proposals are pending with the state Office of Insurance Regulation at a time when the Obama administration has tried to shift attention to rate increases, amid the broader national debate about reforming health care.

That focus increased after Anthem Blue Cross of California sought a 39 percent increase on individual policies. Obama this week proposed setting up a federal authority that could reject rate increases.

Also on Wednesday, U.S. Health and Human Services Secretary Kathleen Sebelius asked chief executives of UnitedHealth Group Inc., WellPoint Inc., Aetna Inc., Health Care Service Corp. and CIGNA Health Care Inc. to attend a March 3 meeting to discuss insurance premiums.

The Blue Cross proposals would affect four individual-coverage plans that totaled 196,286 policies as of a Nov. 30 count, according to the company's filing with the state Office of Insurance Regulation.

About 96 percent of those policies are in plans known as BlueChoice and BlueOptions. Under the proposed increases, which would take effect June 1, the average annual premiums in BlueChoice would increase from $5,640 to $6,272, and average premiums in BlueOptions would go from $3,656 to $4,066.

Blue Cross also raised rates for the PPO plans by 9.1 percent in June 2009, 9.7 percent in June 2008 and 13.9 percent in June 2007, according to the filing.

The company also would raise rates, beginning July 1, for small-group coverage offered under the names BlueChoice, BlueOptions, BlueSelect and Miami-Dade Blue. Small-group plans are sold to businesses with up to 50 employees.

The average increase in the plans would be about 14.8 percent, with an average annual premium totaling about $10,000.

Also, Blue Cross would pass along a 14 percent average increase for small group coverage in its Health Options health-maintenance organization.

The proposal for individual plans would be similar to an 11 percent increase that Blue Cross customers of the state's Cover Florida insurance program will see. That 11 percent total reflects the trend in increased medical costs, according to the Office of Insurance Regulation.

A check of other major insurers' rate filings since Jan. 1 did not find significant increases. 

-- Capital Bureau Chief Jim Saunders can be reached at 850-228-0963 or by e-mail