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HMOs Ask For 11% 2005 Rate Increase

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NU Online News Service, July 14, 2004, 4:33 p.m. EDT

Health maintenance organizations want to raise rates by an average of about 11% in 2004, according to Milliman USA, Seattle.[@@]

A year ago, HMOs told Milliman they expected to raise rates about 15%.

Milliman has based the 2005 statistics on responses from HMOs that serve large employers.

This year, Milliman has added rate questions for fully insured preferred provider organization plans. PPOs are expecting to raise rates 12% in 2005, Milliman says.

Although participating HMOs may be asking for somewhat smaller increases than they were demanding a year ago, 2005 seems likely to be the sixth straight year of double-digit health coverage cost increases, Milliman says.