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After suffering a precarious 2015 marked by enormous losses and a state demand that it raise additional capital, Moda says it has complied with the state's order. It is also seeking to raise rates in the individual insurance market by a third.
(Courtesy of Moda Center)
Every Oregon health insurance company but one is proposing double-digit percentage rate hikes for the individual market in 2017, with two of the biggest players -- Moda Health Plans and Providence Health Plans -- both seeking to raise rates by nearly a third.
Seven of the 12 insurers in the small-group market are also seeking increases, albeit smaller than those in the individual market.
It marks the second straight year of sizable increases since implementation of the Affordable Care Act. Oregon health insurers, no longer able to legally reject customers due to pre-existing conditions, have struggled to adjust to life under the act.
"When we did our analysis of the 2015 financial results, we saw that Oregon's seven largest insurers lost $171 million," said Jake Sunderland, spokesman for the Oregon Insurance Division. "That's not an ideal situation."
Moda proposed the biggest individual market hike in the state at 32.3 percent, followed by Oregon's Health Co-op, which is asking for 32 percent. Among the other major players, Kaiser is seeking a 14.5 percent hike and Regence BlueCross Blueshield of Oregon is asking for a 17.9 percent increase.
Health Net Health Plan of Oregon was the sole insurer not asking for an increase. It proposed leaving its 2017 individual market rates essentially unchanged from the current year. Health Net last year was bought out by Centene Corp., a large St. Louis-based company.
Federal officials said for about 71 percent of Oregon consumers the higher insurance rates will be balanced by tax credits. These tax credits, created by the Affordable Care Act, "will go up to compensate for (rate) increases," said Jonathan Gold, press secretary for the U.S. Department of Health & Human Services.
Moda lost nearly $50 million last year, the second consecutive year it finished in the red. But the Portland company claims it has emerged from its precarious financial straits.
The company announced Friday it has sold off a subsidiary company and a Milwaukie office building and taken other steps to generate $165 million in additional capital. "What they announced Friday brings (Moda) to a place where they meet or exceed the capital requirements" the state imposed when it ordered the company to shore up its finances, Sunderland said.
Providence Health Plan is seeking a 29.6 percent increase in the individual market and a 7.9 percent hike in the small group business. The company lost $63 million last year.
The ranks of Oregon health insurers is smaller in 2017. Lifewise recently announced it will pull out of the state.
Health insurance companies submitted rate requests to the Department of Consumer and Business Services, Division of Financial Regulation on May 2. The division must review and approve any rates before they can be charged to policyholders.
"For the next two months, we will analyze the requested rates to ensure they adequately cover costs without being too high or too low," said Insurance Commissioner Laura Cali. "Our open process allows Oregonians to see everything we do and provide comments on the filings that affect them."
The proposed rates are for plans that comply with the Affordable Care Act for small businesses and individuals who buy their own coverage rather than getting it through an employer. Only about 10 percent of the state's insurance customers get coverage through those markets.
The state will put a searchable database of the proposed rates at oregonhealthrates.org. State regulators are encouraging Oregonians to comment on the rate requests at the website through the May 6-June 24 public comment period.Information on future hearings on the proposed rates will also be posted at the site.
The state will announce its preliminary rate decisions on June 16 and its final rates on July 1.
-- Jeff Manning
503-294-7606, jmanning@oregonian.com