Blue Cross Blue Shield of Vermont, Individual Medicare Supplement Standard and Medi-Comp Plans
The Company is proposing an overall rate increase of 7.617%, with plan increases ranging from 5.794% to 8.108%.
Plain Language Summary:
BCBSVT Medicare Supplement Rate Filing for 2014
Blue Cross and Blue Shield of Vermont (BCBSVT) is a Vermont company that exists to provide health benefits and financing to Vermonters. There are currently 5,094 BCBSVT Medicare Supplement members. BCBSVT is proposing an average rate change of +7.6%, with a range of +5.8% to +8.1% for the various plans. These increases are based primarily on our estimates of the medical costs that the covered members will incur in 2014. Claims costs are expected to rise by an annual trend rate of 5.8% from the experience period to the new coverage period. This trend rate is estimated from:
• the current estimates of the 2014 Medicare deductibles and projected physician fee schedule changes as listed in the 2013 Medicare Trustees Report, dated May 31, 2013, and
• regression statistics from the recent experience of the BCBSVT Medicare Supplement business.
The administrative expense charge per member per month (PMPM) has decreased by 5.5% from the administrative expense charge included in the 2013 rate filing. The contribution to reserve has increased from 0% in the 2013 rate filing to 2% in the 2014 rate filing. 2% is the traditional contribution to reserve built into the BCBSVT Medicare Supplement rates; the 0% used in the 2013 rate filing was anomalous. The 2014 administrative expense charge PMPM and contribution to reserve percentage are from the most recent BCBSVT Administrative Charges and Contribution to Reserves filing (SERFF BCVT-129035275, VFN 66415). The anticipated loss ratio, if the filing assumptions hold true, is 84.4%.
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