Instead of the notorious 25% increase that helped resuscitate Obamacare early this year, the company will seek a 14% increase. That’s a point under the increase recommended by Axene Health Partners, the actuarial firm that found errors in Wellpoint’s original filing.
Increases would be capped at just under 20%; in the last filing rates famously could have risen as high as 39%. The insurer asserts it will lose $100 million this year because of inadequate rates.
It’s starting to become clear that insurers will have to clamp down on costs. From the Wall Street Journal:
“We need collectively, all the component parts of this industry, to work harder in collaboration with government officials to help control these rising costs,” said WellPoint’s strategy chief, Brad Fluegel.
“Fourteen percent is still too high for our customers,” he added.
Len Nichols, a health economist at George Mason University, said that WellPoint has “been asserting the point that, ‘You’ve got to understand we can’t control costs.’ And that point has been made, and the message has been heard.”
Health care reform won’t work unless insurers, citing regulatory pressure on rates, negotiate lower reimbursements for doctors and hospitals. That would help crush inflation expectations.
Aetna, which pulled its filing because of math errors, refiled seeking the same 19% increase it had sought before.
(Via Kaiser Health News.)