Montana Providers Can File New Rates Without U.S. Subsidy

Montana Health Co-Op and PacificSource Health Plans tell state auditor they will file rate hikes

By Associated Press

HELENA — Federal regulators are allowing two companies offering health insurance through the individual market in Montana to file rate increases after President Donald Trump’s decision last week to end certain payments to insurers that help low- to middle-income workers, the state’s insurance commissioner said Monday.

That’s a reversal from Friday, when the Center for Medicare and Medicaid Services notified the state Department of Insurance it would not allow companies to further raise rates in 2018.

Insurance Commissioner Matt Rosendale said Montana Health Co-Op and PacificSource Health Plans told him Monday they were filing rate hikes.

On Friday, Rosendale had said he would hold both companies to the rate increases they had already proposed unless he heard differently from the center.

Those increases averaged 4 percent for the co-op and 7.4 percent for PacificSource.

Montana Health Co-Op now will file for an average 24 percent rate hike on top of the 4 percent increase, spokeswoman Karen Early said.

PacificSource has filed for an average 11 percent rate hike for a standard “silver plan” atop the 7.4 percent increase, said Todd Lovshin, PacificSource’s vice president and Montana regional director. That hike applies to about 43 percent of PacificSource’s Montana marketplace, Lovshin said.

Open enrollment starts on Nov. 1, and rates and plans take effect on Jan. 1. Blue Cross has 31,000 Montana policyholders this year, the co-op covers about 20,000 and Pacific Source has about 12,000 policy holders.

“I am extremely disheartened by these last minute actions of both PacificSource and Montana Health Co-Op,” Rosendale said. “My department was advised by both companies just months ago, that with or without (the federal payments), they would be able to honor the rates they provided to us and the public.”

Lovshin said: “We have been clear in rate hearings and our public presentations that our rates were assuming the present healthcare law would continue and that the (federal reductions) would continue to be paid. We have worked really hard to minimize the impact to our members.”

Jerry Dworak, CEO of the Montana Health Co-op, said last week that if the co-op couldn’t update its rates or leave the state marketplace it would lose more than $30 million next year, in addition to the $8 million it would lose over the next three months with the end of the federal payments to insurers.

Another carrier, Blue Cross and Blue Shield of Montana, submitted premium increases of about 22.3 percent to account for the possibility of losing the federal subsidy. It will stick to that rate hike.