CareFirst Defends Revised Rate Increase Requests Amid Public Opposition

The Maryland Insurance Administration held a second rate review hearing on Monday to address the revised increase on rates requested by CareFirst. Sarah Li, Chief Actuary for the Maryland Insurance Administration, opened the hearing with a number of specific questions including some that advocates share:

  • Why are CareFirst's Maryland premiums so much higher than those for DC subscribers? 

  • Are Marylanders being asked to subsidize DC residents' premiums, as the DC Insurance Commissioner has frozen CareFirst's rates for 2017?

CareFirst CEO, Chet Burrell, offered a detailed explanation of the revised rate request, citing nearly $300 million in losses during their first three years in the exchange and an "older, sicker" population than anticipated. He also stated that there was no subsidization of DC residents by Maryland consumers, and that the lower rates in DC were largely due to the fact that, unlike in Maryland, DC's risk pool includes small groups as well as consumers in the individual market.

In response, several consumers provided their individual perspectives on the negative impact CareFirst's requested rates would have on their own families and others like them, including small businesses who insure through the individual market. Chris Jakubiak, president of Jakubiak & Associates, Inc., has put off hiring additional employees because of the cost of health insurance, and Dan Meszler, a self-employed engineer, has had to leave the market entirely. Other consumers provided written comments on-line, as did the Health Education and Advocacy Unit of the Attorney General's Office, noting "Consumers who stay in these individual plans ... will never get their money back if excessive increases are allowed based on inaccurate or erroneous data and assumptions." 

Consumer Health First first presented its case for rejection of the rate request in its Baltimore Sun OpEd.  At Monday's hearing, we strongly urged Commissioner Redmer to not only reject CareFirst's new request, but to cut its initial request. Jeananne Sciabarra, Executive Director, was joined by Jay Angoff of Mehri & Skalet, who prepared our initial analysis. They reiterated the negative impact that the proposed premiums would have on consumers' pocketbooks and then laid out a substantive case for rejecting the CareFirst request. In addition to the affordability issue, they noted: 

  • Rate increases of this magnitude will push the healthiest consumers from the market altogether, or to other carriers, leaving CareFirst with only the sickest members, thus requiring large increases next year, and so on. In addition, these rates will discourage the young and healthy from entering the market, disrupting one of the core principles of the Affordable Care Act. 

  • These rate increases contradict the CMS report from last Thursday showing that, nationwide between 2014 and 2015, there has been little change in the cost per enrollee in the ACA individual market. 

As Mr. Angoff noted "There is just such a disconnect of such a magnitude between the CMS data and the CareFirst data, it just doesn't make sense."

For a complete summary of Ms. Sciabarra's testimony, click here.

Worried about what the impact of higher insurance rates may mean for you and your family? Read our in-depth Rate Review Analysis to learn more.

Our Op-Ed Regarding CareFirst's Rate Revision

Consumer Health First President, Leni Preston, penned an Op-Ed in The Baltimore Sun: In an unprecedented move, CareFirst, Maryland's largest insurance provider, just submitted a new rate filing for its plans in the individual market for calendar year 2017, more than doubling the rate increases it proposed in May to a whopping 28 percent for its HMO and 37 percent for its PPO business. We feel it's unjustified - and here's why.

CareFirst Ups Insurance Rate Request at the 11th Hour

In an article published in yesterday's Baltimore Business Journal, it was reported that CareFirst has introduced a last minute insurance rate increase request for the 2017 enrollment period. The new requests are more than double than their original rate increase requests in some instances. 

CareFirst's rate increase requests went from 12% for their HMO product to 27.8%, and from 30% to 36.6% for its PPO products. This will almost certainly put these plans out of reach in terms of affordability for many consumers, since the average monthly cost is predicted to be $382 - $478 for a mid level plan for a 40 yr. old.

Consumer Health First President, Leni Preston, went on the record saying that we are "extremely concerned" about the new requests from CareFirst. Consumer Health First presented testimony at the first public hearing which expressed concerns about the morbidity rates CareFirst used to determine rate increases in the past. Read the CHF testimony here.

"We are going to be looking into the basis for the proposed increase...we need to see what the justification is for this," she said. "Also with the timing, it being so late into the process, we want to make sure there is adequate transparency and opportunity to's important that consumers understand the impact."

A public hearing regarding these additional rate requests will be held on August 15th, at 11:00 AM at the Insurance Administration headquarters. 

In the meantime - watch the box in the upper left hand corner of this page to keep up to date on the latest in the rate review process.

Transformation: Getting it Right Our 3rd Annual Engagement Symposium

You won't want to miss this opportunity to hear the latest updates about Maryland's multiple healthcare reform initiatives from the leaders at the forefront of healthcare reform in Maryland.

Consumer Health First's third annual Get Engaged Symposium will convene on September 16 at the Unitarian Universalist Church of Annapolis. Our theme is Transformation: Getting it Right. Some of the questions we will ask are:

  • As we enter our 4th Open Enrollment period - just how transformative has the ACA been and what more must we do?
  • Is Maryland's All-Payer Model as transformative as leaders say?  If so, why? And, what issues do we need to watch for?
  • Are Maryland's transformation initiatives having an impact on our mission of health equity? If not, what more can we do?  
  • How can we continue to engage, as individuals and collectively, in the transformation of our health care system? 

Helping us answer these questions and more are a talented array of healthcare policy professionals and providers. Confirmed speakers include:

  • Keynote Speaker: Dr. Cara James, Director of the Office of Minority Health at the Centers for Medicare & Medicaid Services (CMS).  
  • Willem Daniel - Social Science Analyst, Center for Medicare and Medicaid Innovation, CMS
  • Adrienne Ellis - Director, Healthcare Reform and Community Engagement, Mental Health Association of MD  
  • Dianne Feeney - Associate Director, Quality Initiative at Maryland Health Services Cost Review Commission
  • Leni Preston - President, Consumer Health First
  • Carolyn Quattrocki - Executive Director, Maryland Health Benefit Exchange 
  • Jeananne Sciabarra - Executive Director, Consumer Health First
  • Nicole Dempsey Stallings - Vice President, Policy and Data Analytics, Maryland Hospital Association
  • Hillery Tsumba - Manager of Communications and Development, Primary Care Coalition of Montgomery County and Member of HSCRC Consumer Engagement Task Force
  • Ben Turner - Program Manager, Primary Care Coalition of Montgomery County 

The early bird gets the worm! Register before August 20, and save $5. Click the link to....


A Guide to the Federal Parity Law for Substance Abuse and Mental Disorders

The Legal Action Center has published Health Insurance for Addiction and Mental Health Care: A Guide to the Federal Parity Law. The Guide explains patients’ and providers’ rights to insurance coverage for substance use and mental disorders. Although written for a New York audience, much of the Guide can be used anywhere in the country.

Think you know all there is to know about the ACA?

President Barack Obama became the first sitting President of the United States to publish a scholarly article this week, when he wrote in JAMA - The Journal of the American Medical Academy, an article entitled "United States Health Care Reform - Progress to Date and Next Steps" . In it, he summarizes the importance, objectives, findings and relevance of the Affordable Care Act since its passage. He concludes that "although partisanship and special interest opposition remain, experience with the Affordable Care Act demonstrates that positive change is achievable on some of the nation’s most complex challenges."

As you might imagine, the pundits had a field day with this, and you can read a collection of the praise and potshots taken at his effort on Politico. 

So, if you think you know as much about the ACA as the President - here's a little crossword puzzle for you. We'll post the answers here next week.