National and California advocacy groups are tweeting about the recent decision by the California Department of Managed Health Care to find small-group rates proposed a unit of Aetna Inc. (NYSE:AET) to be unreasonable.
For the 12-month period that started July 1, Aetna proposed an average increase of 21 percent when compared with 2014 rates for plans covering 13,000 enrollees.
Department officials had no authority to reject or change the increase, but they classified it as “unreasonable” and “unjustified.” The department put out a press release about the ruling, and Shelley Rouillard, the director, said in a statement that, “Aetna’s pattern of unreasonable increases equates to price gouging.”
Aetna argued that it needs a substantial increase because new restrictions on underwriting are likely to leave it with a sicker, older, more-expensive-to-insure pool of enrollees.
Utilization of care has been going down, up until now, but the unit cost of the prescription drugs used has increased 17 percent, and per-patient amounts, or capitated amounts, for inpatient hospital care have increased about 18 percent, the company said.