Middle class families, seniors will see health insurance costs rise while insurance companies profit
May 30, 2012
AUGUSTA – A proposed rate hike from Anthem Health Insurance is 1.7 percent will get no prior approval because of a change to the law made this year in the state legislature. As part of the Republican-led insurance overhaul, insurance rate increases of up 10 percent no longer require prior review or approval from the state’s consumer protection agency.
“The unfair changes made to the law this session will allow insurance companies to take money out of the pockets of working people,” said Rep. Sharon Treat, D-Hallowell, the lead House Democrat on the Insurance and Financial Services Committee. “The Republican-controlled Legislature made a big mistake when it repealed consumer protection laws that used to give the insurance superintendent strong authority to review rate increases and knock them back when excessive. Maine families will be left with the tab so insurance companies can make a larger profit.”
Anthem filed the proposed rate increase, which is expected to increase the company’s profit margin by $2 million, with the Maine Bureau of Insurance in April.
According to Consumers for Affordable Health Care, all individual policyholders over age 60 will see a rate increase in the 20 percent range.
The announcement comes in the aftermath of a Republican-led budget that cut millions of dollars from initiatives that help lower the cost of prescription drugs for the elderly.
“Enough is enough,” said Treat. “Middle-aged and older Mainers are getting clobbered with insurance rate hikes, especially in rural areas– and seniors won’t be able to afford critical prescription drugs.”
Before the law change, proposed increases by Anthem could be denied or lessened during the prior review process. Former Superintendent of Insurance Mila Kaufman rejected a 9.2 percent increase proposed in 2011 by Anthem, instead allowing only a 5.2% increase.
Kaufman’s decision saved Maine policyholders over $3 million.
Jodi Quintero [Treat] 287-1488, c. 841-6279