BCBSVT Third Quarter and Fourth Quarter 2013 Safety Net Rate Filing.
BCBSVT is proposing an average annual rate increase of 15.0% above current rates for both third quarter and fourth quarter health insurance policy renewals.
Third and Fourth Quarter BCBSVT Safety Net Rate Filing
Blue Cross Blue Shield of Vermont (BCBSVT) is a Vermont company that exists to provide health benefits and financing to Vermonters.
There are 217 third and fourth quarter-renewing Safety Net members (120 subscribers). The calculated required rate increases for Safety Net members renewing in the third and fourth quarter are +31.3% and +27.4%, respectively. However, due to statutory limitations, BCBSVT is proposing a rate change of +15.0% for all members. The estimated loss ratio expected in the pricing for third and fourth quarter 2012 Safety Net rates was 93.4%. The estimated loss ratio expected in the pricing for third quarter 2013 Safety Net rates is 93.1%; however, with the capped rate increase, the loss ratio is 106.3%. The estimated loss ratio expected in the pricing for fourth quarter 2013 Safety Net rates is 93.1%; however, with the capped rate increase, the loss ratio is 103.2%.
The calculated rate changes of +31.3% and +27.4% are based primarily on BCBSVT’s estimates of the medical and drug costs that the covered members will incur during the projected experience period. Actual claims cost were much higher (about 16%) than expected for the calendar year 2012. Claims costs are also expected to rise by 6.8% in the new coverage period.
The administrative expense charges used in the rate development have decreased from those used in the development of the third and fourth quarter 2012 rates. Although there is a 2.0% contribution to reserve used in the rate development, the actual impact on BCBSVT reserves is negative due to the capped rate increase.
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Once the actuarial opinion has been received by the Department and the Commissioner’s recommendation concerning this filing has been made, these documents will be found at the Green Mountain Care Board’s rate review website: http://gmcboard.vermont.gov/rate_review You can search the Board’s website using the SERFF tracking number at the top of this page. Once the decision has been issued by the Board we will update the status of the filing on our website. Please note there is a time lapse between when the filing is submitted to our Department and when the Board issues the decision.