When open enrollment in the insurance exchanges closes March 31 for most Americans, insurers will be scrambling to evaluate their new membership, assess the Obama administration's latest rules, guess at their competitors' strategies—and decide on exchange plan premiums and their choice of markets for 2015.
In some states, insurers must file their proposed 2015 rates as soon as May 1, while in the 36 states relying on the federal HealthCare.gov exchange they have until June 27. That already-tight timetable was made even tighter last week when the administration extended open enrollment for consumers who attest that they tried to but could not enroll because of a range of factors beyond their control.
Insurers' short turnaround time, coupled with regulatory uncertainties, has led some industry officials and outside experts to predict that double-digit rate hikes could be in the works. That would be bad news for consumers, the administration and Democrats running for election in November. The fear is that if premiums rise significantly, fewer healthy but uninsured Americans will sign up in 2015, leading to more rate hikes. Still, many observers say the exchange market would survive rate increases because the law's re-insurance and risk-adjustment mechanisms protect plans with higher-than-expected costs.
“There will undoubtedly be remarkable price increases,” WellPoint CEO Joseph Swedish said. He added that the prospect of double-digit hikes “appears as if it's likely,” but he was uncertain about specific numbers. His company—the biggest commercial insurer in the exchanges, with 500,000 members as of the end of January—will study the demographics and medical utilization of its new members to figure that out.