ALBUQUERQUE – New Mexico regulators are unveiling details about the health insurance premiums proposed by insurers for next year, and there are indications the state will not escape the hefty increases expected nationwide.
Rate hikes for 2017 could reach well into the double digits in New Mexico and elsewhere as insurers deal with the financial drain resulting from President Barack Obama’s health care law.
More than 12 million people get coverage though the health law’s markets, which offer subsidized insurance. But the increases could also affect several million who purchase policies outside the government system.
In New Mexico, several insurers have filed proposals that include average increases ranging from a half-percent to more than 83 percent.
State regulators and insurance company representatives said Wednesday the initial estimates may change, but overall, customers can expect premiums to increase in 2017.
Presbyterian Health Plan, one of the state’s largest carriers, expects rates to increase for individuals buying coverage both on and off the exchange anywhere from 5 percent to around 35 percent.
Brandon Fryar, vice president of finance and chief financial officer for the Presbyterian Health Plan, said the company has lost millions of dollars over the last two years as costs have substantially outpaced premiums.
The problems with the health care law center partly on lower-than-hoped-for enrollment and sicker-than-expected customers.
Fryar said the challenges are even more formidable in New Mexico, where poverty continues to plague residents and the percentage of people on Medicaid is among the highest in the nation. The goal is to price the premiums so that they cover costs, he said.
“We can’t do it through a solution that passes those costs onto other customers,” Fryar said. “At Pres (Presbyterian), we want a solution that’s sustainable and sets us up for success in providing coverage for New Mexicans.”
Blue Cross Blue Shield of New Mexico also plans to sell coverage on the exchange this year, and proposals submitted to the state show average increases of as much as 83 percent for individuals.
The company withdrew from the exchange for 2016 after regulators denied its request for a 52 percent rate hike.
Company President Kurt Shipley said Wednesday the 83 percent listed by the state doesn’t accurately reflect proposed rates since new plans will be offered and the premiums will be competitive with those of other insurers in the New Mexico market.
“It’s not an apples-to-apples percentage that anyone should be focused on,” he said.
Insurers plan to make another round of filings in June after weighing the market along with the participation of other carriers and their proposed rates.
