Health insurance costs will probably jump by 10 percent or more next year for many Kentuckians buying coverage through Kynect, the state-run insurance exchange created under the federal Affordable Care Act.
The five providers that are returning to Kynect have requested average rate changes for 2016 that range from a decrease of 9.28 percent (WellCare Health Plans of Kentucky) to an increase of 25.1 percent (Kentucky Health Cooperative).
Two other companies offering insurance plans in the private marketplace that comply with requirements of the health law requested rate increases of 9.93 percent and 11.5 percent.
In addition, three new companies have said they plan to offer insurance plans that comply with requirements of the health law on Kynect and in the private marketplace. Three others said they also will begin offering such plans, but only in the private marketplace.
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The rate requests were released Wednesday by the Kentucky Department of Insurance. The requests are being reviewed by state actuaries, and changes might occur. The rates will be finalized in mid-July, insurance department spokeswoman Ronda Sloan said.
Kentucky is one of only a few states that have so far publicly released requested rate increases, but rates appear to be going up across the country, said Cynthia Cox, associate director of health reform and private insurance for the non-profit health research group Kaiser Family Foundation.
"We really won't know complete information for every state until open enrollment begins" in the fall, she said.
Kentucky is unusual, she said, in that five new providers plan to sell insurance in Kentucky next year. The average increase across the country is one new insurer per state.
Some of those new insurers may undercut previous rates offered in Kentucky, she said.
Sloan said federal statistics show that insurance companies in Indiana have requested average increases ranging from 13.24 percent to 26.5 percent. In Ohio, requested increases ranged from 11.76 percent to 37.66 percent, she said.
In a statement to the Herald-Leader, Gov. Steve Beshear said an average increase does not translate directly into prices going up for individuals. Rates vary depending on the provider, where a person lives, whether they smoke and the size of their family, he noted.
In addition, most people who buy insurance plans through Kynect will be eligible for payment assistance.
U.S. Sen. Mitch McConnell said in a statement that the looming rate increases reflect a "broken promise" and that the "unworkable law" needs to be repealed.
Joe Smith, chairman of the Board of Kentucky Health Cooperative, said the company's request for a 25.1 percent rate increase is necessary because many of those with complex health issues who were previously covered by the state's high-risk insurance pool switched to Kentucky Health. That means the company insures some of the sickest people who are the most expensive to treat.
He also said the company's proposed rates are "competitive and in some cases still lower than those filed by most of our competitors." He added that state review of the requested rates means "decisions on premium rates cannot be made unilaterally by the insurer."