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Life Health > Health Insurance > Health Insurance

PPACA factors into rate filings

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Patient Protection and Affordable Care Act provisions seemed to have a modest effect on health insurance premiums from mid-2012 through mid-2013.

Michael McCue, a health administration professor at Virginia Commonwealth University, and Mark Hall, a law professor at Wake Forest University, come to that conclusion in a paper based on analysis of rate filings filed from June 2012 through June 2013.

The researchers found that insurers mentioned PPACA provisions other than the MLR provision as a reason for a rate increase more than half the time.

Carriers cited non-MLR PPACA provisions in 39 percent of the individual market filings and 62 percent of the small-group market filings.

The researchers found that 94 filings mentioned the women’s preventive services mandate, and 65 estimated the financial impact. Financial impact estimates ranged from 0 percent of premium, in three filings, to 4.5 percent of premium. The median impact was 0.8 percent of premium.

About 29 percent of all of the filings set to take effect in 2013 mentioned the PPACA insurance premiums tax that’s supposed to take effect in 2014 and a reinsurance assessment fee that’s supposed to be imposed in 2014.

The researchers said they expect the new taxes and fees to amount to about 2 percent to 3 percent of a typical carrier’s premiums in 2014.

In the 2013 filings that mentioned the PPACA taxes and fees, the median impact estimate was about 1.5 percent of premium, the researchers write.

The sample included 163 individual rate filings filed by 122 insurers, and 148 small-group filings filed by 105 insurers. The researchers only looked at filings if the insurers had asked for a rate increase of 10 percent or more. They excluded the effects of the PPACA minimum medical loss ratio provision, because most insurers cited the minimum MLR rules as a reason to reduce premiums.

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