BIRMINGHAM, Ala. — Alabama health insurance providers who offer plans on the ObamaCare exchange are seeking significant price increases this year, after healthcare costs took a sharp upward turn.
Blue Cross Blue Shield of Alabama is reportedly requesting an average of a 28 percent increase for its individual plans, as well as a 73 percent increase for its platinum plan. Small group plans could also increase by nearly 14 percent.
UnitedHealthcare is seeking a 24.5 percent increase for its 2016 rates.
Several other states are also experiencing severe rate increase requests, with rate hikes of up to 51 percent in New Mexico and more than 30 percent in Tennessee and Maryland.
The rate increase requests must be reviewed by federal agencies before being approved. Tuesday is the deadline for filing rate increase requests.
These rate hikes well outpace the rate of inflation and wage growth, making health care more and more expensive for Alabamians.
One researcher from the Heritage Foundation said these large price increases were to be expected because insurers underpriced for the first several years of the exchanges.
“This is going to be a phenomenon of insurers that priced more optimistically instead of defensively,” said Ed Haislmaier, a senior research fellow in health policy studies at The Heritage Foundation.
“Insurers that were more optimistic in setting their premiums wound up having to play catch up. On one level, it’s completely ObamaCare. It’s catch-up by the ones who underpriced. The ones who had higher rates had realistic responses to ObamaCare, and the others are playing catch up.”
All this occurs as the U.S. Supreme Court (SCOTUS) is poised to make a decision on whether the federally-run healthcare exchanges are permissible under the law. If SCOTUS rules against ObamaCare, it could effectively hobble the President’s namesake legislation by shutting down exchanges in 34 states.
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— Elizabeth BeShears (@LizEBeesh) January 21, 2015
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