DCCA Releases 2016 ACA Rates

Final decisions for 2016 Affordable Care Act individual and small group health insurance rates has been made by the Department of Commerce and Consumer Affairs Insurance Division.

Rate changes that were approved by the division vary by plan type, with final approved rate filings found at the DCCA website.

The rates are expected to affect 34,000 individuals currently purchasing health insurance on their own through the ACA marketplace. Small group rates apply to businesses with 50 or less full-time employees.

“We were extremely concerned by the requested increases by insurers for 2016 ACA individual plans,” said State Insurance Commissioner Gordon Ito. “Nobody likes to see prices go up for the individual consumer. However, upon close review of the carriers’ expenses, benefits paid, and other considerations our rate analysts and actuaries found premium increases were necessary for the carriers to cover their costs, enabling them to continue to pay their customers’ claims.”

In Hawai’i, law mandates that insurance rates cannot be excessive, inadequate, or unfairly discriminatory.ACA individual plans rates were deemed to be inadequate in 2015 and will be significantly adjusted for next year.

Rate increases in 2016 were needed due to several reasons, according to the Hawai’i Insurance Division, including “pent up demand” for services sought by previously uninsured individuals, transitional plans and previously low penalties for ignoring ACA’s individual mandate keeping healthy populations out of the marketplace, high cost specialty drugs, and ACA taxes and fees.

Hawai’i health premiums for individual ACA plans were among the lowest in the country, based on a 2015 report by the Centers for Medicare and Medicaid Services. The state ranked 45th in terms of average monthly premiums with an average cost of $289.64, before marketplace tax credits or subsidies. The most expensive state to purchase health insurance had average premiums of $522.73.

Enrollment for individuals opens on Nov. 1.