Health Net Inc. (NYSE:HNT) says individual claim costs per enrollee are about twice as high as they used to be.
Health Net gives an early look at the effects of the Patient Protection and Affordable Care Act (PPACA) on individual major medical experience in documents filed with the California Department of Insurance.
PPACA now requires health insurers to sell individual major medical coverage without considering personal health status in decisions about whether to issue coverage, and without using health information other than age and tobacco use when pricing the coverage. In the past, California let individual health insurers use medical underwriting when issuing and pricing coverage.
Health Net asked California regulators in June for permission to raise prices on some individual medical policies sold on and off the public exchange system an average of 7.9 percent.
The company provided claims comparison data from the past for small-group coverage, but not for individual coverage. Regulators asked for historical data for the individual market. Health Net said Aug. 6, in a response, that it believes the small-group market information is more relevant, because guaranteed-issue rules took effect in the small-group market earlier.
Extracting and adjusting historical individual market data in a way that would allow for apples-to-apples comparisons with the new, PPACA-compliant products would be difficult, Health Net said. ”Also,” Health Net said, “our individual claims costs for the first four months under PPACA are more than double what they were prior to PPACA.”