BALTIMORE (June 20, 2017)—Consumer Health First and 36 other organizations called on the state today to reject the premium rate increases for Maryland's individual market proposed by CareFirst, the state's largest insurance company. The groups say these rate increases are unjustified and will cause undue financial burden on consumers and destabilize Maryland's individual health insurance market.
"We urge you to protect Maryland's individual health insurance market so it can continue on its path to stability and maturity," states a letter sent by the organizations to Maryland Insurance Administration, which is considering rate requests for consumers beginning January 1, 2018. "By rejecting CareFirst's proposed increases, you will also protect consumers from the devastating impact these proposed rates will have on their continued access to affordable health care."
The Maryland Insurance Administration will hold a hearing on the rate requests tomorrow, June 21.
CareFirst submitted a rate request that seeks an average 50.4 percent increase on its HMO plans and an average 58.8 percent increase on its preferred provider, or PPO, plans. Other insurance companies in the state's individual market also requested increases, but CareFirst's request was by far the highest.
"CareFirst is not living up to its obligations as a nonprofit health service plan to provide affordable, accessible insurance in the individual market," said Leni Preston, president of Consumer Health First. "These rates would make insurance unaffordable for thousands of Marylanders, particularly those who do not qualify for a federal subsidy under the Affordable Care Act."
Consumer Health First's analysis of the rates found a number of concerns with CareFirst's justification for its proposed hikes to premiums. CareFirst's assumptions about increases in medical costs far exceeded those of other insurance carriers. CareFirst also asserted its morbidity rate will increase in 2018, but there is no evidence to suggest consumer behavior will change.
CareFirst also remains on solid financial footing, with a surplus far exceeding what is required by law for a health insurer, despite its losses on the individual market since 2014.
"The Commissioner has the statutory authority to consider affordability and accessibility when reviewing CareFirst's rate filings," said Beth Sammis, former acting commissioner of the MIA and a Consumer Health First board member. "These rate filings result in unaffordable health insurance for many in the individual market and thus must be rejected."
Research from Standard & Poor's found that nationally the individual market is improving and needs time to mature, and the subsidies provided under the Affordable Care Act stabilize the individual market. However, that could unravel should rates continue to increase, pricing individuals out of the market and preventing many people from accessing the care they need.
"While the individual market covers a relatively small number of people as compared to the rest of the health insurance market, it is absolutely critical that we ensure that it continues to stabilize," Preston said. "Health care is not a luxury; it is an essential right, and we as a state must do everything we can to make it affordable and accessible to all Marylanders."
"Every player must do their part to ensure that the one in four individuals with a mental health or substance use disorder have access to affordable treatment options," said Dan Martin, director of public policy for the Mental Health Association of Maryland. "In the face of a continuing rise in overdose deaths and suicides, CareFirst's proposed premium rate increases of 45-70 percent is an unconscionable barrier to treatment that must be rejected."
The groups also asserted that, despite the current uncertainty caused by the healthcare debate at the federal level, Maryland still has an obligation to protect its citizens. The letter reads: "Consumers should not be the ones to bear the burden of the uncertainties that CareFirst may face due to actions, or in-action by legislators and policy makers in Washington. We implore you to hold CareFirst to its statutory mission of providing affordable and accessible health insurance to its insureds."
The following groups signed on to the letter:
• Advocates for Children and Youth
• Baltimore City Substance Abuse Directorate
• Behavioral Health System Baltimore
• Center for Children, Inc.
• Community Behavioral Health Association of Maryland
• Disability Rights Maryland
• Drug Policy and Public Health Strategies Clinic, Univ. of Maryland Carey School of Law
• FIRN, Inc.
• Greater Baltimore HIV Health Services Planning Council
• League of Women Voters of Maryland
• Licensed Clinical Professional Counselors of Maryland
• Maryland Affiliate of the American College of Nurse Midwives
• Maryland Assembly of School-Based Health Care
• Maryland Center on Economic Policy
• Maryland Coalition of Families
• Maryland Nonprofits
• Maryland Nurses Association
• Maryland Occupational Therapy Association
• Maryland United for Peace and Justice
• Mental Health Association of Maryland
• Montgomery County Department of Health and Human Services
• NAMI Maryland
• NARAL Pro-Choice Maryland
• National Council on Alcoholism and Drug Dependence—Maryland Chapter
• National Women's Health Network
• Noir Consultants and Training Inc.
• On Our Own of Maryland, Inc.
• Planned Parenthood of Maryland
• Progressive Cheverly
• Public Justice Center
• Raising Women's Voices for the Health Care We Need
• The Women's Law Center of Maryland
• Together We Will—Baltimore Area
• Unitarian Universalist Legislative Ministry of Maryland
• Voices for Quality Care, Inc.
• Woman's Democratic Club of Montgomery County
Consumer Health First is a statewide, non-partisan, grassroots alliance of 100 organizations and more than 1,800 individuals that seeks solutions and advances reforms that promote health equity through access to comprehensive, affordable, high quality health care for all Marylanders. For more information, visit www.consumerhealthfirst.org.