Yesterday, Connecticut Insurance Department (CID) officials announced their final health insurance rates for individual and small group health plans. CID approved an average increase of 11.3% for individual plans and 15.1% in the small group market, a slight reduction from the 16.2% and 17.8% respective increases initially requested by state insurers.
“There are no winners when health care costs continue to rise at this pace,” said Josh Hershman, Connecticut’s Insurance Commissioner. “Even when the Department reduces what insurers request, an increase is still an increase. Families and small businesses that are already stretched by the cost of health coverage continue to feel that pressure.”
The five rate filings finalized by CID cover a combined 220,000 Connecticut residents, or a little under 6% of the state’s total population. Insurance executives who presented their rate requests before CID at a public hearing on August 26 argued that their requests were necessitated by rising healthcare costs, higher-than-expected utilization, and the expiration of the Affordable Care Act’s Enhanced federal subsidies. Despite insurers’ rationale, Democrat and Republican lawmakers, state officials, and residents alike have universally panned these requested increases.
Attorney General William Tong released a statement yesterday morning, calling the rate increases “completely unsustainable.” He said the hikes were “not on CID,” but that “we need insurers, hospitals, pharmacy benefit managers, and every player from top to bottom at the table, to earnestly negotiate cost relief way before these rate demands are crafted.”
“This is another whack to Connecticut families and small businesses trying to stay afloat in a sea of skyrocketing costs,” said Tong. “Again, Connecticut families are left to drown in ballooning premiums, deductibles, coinsurances and copays.”
Of the four insurers – ConnectiCare Insurance Company, ConnectiCare Benefits, Anthem, and UnitedHealthcare – Anthem provides insurance for the most Connecticut residents. Anthem, which provides both individual and small group plans, originally requested a 12.8% average increase for individual plans and a 17.4% average increase for small group plans, but ultimately received average increases of 8.8% and 15.5%, respectively. UnitedHealthcare offers small group plans in Connecticut and requested an average increase of 18.9% before receiving an average increase of 14%.
ConnectiCare Insurance switched from offering on-exchange individual plans to off-exchange ones, making a rate comparison impossible. The CID approved a revised filing for its plans, allowing ConnectiCare to slightly increase its “annualized claims trend,” which projects future utilization of a plan by its members to determine premiums, from 9.2% to 10.4%, and slightly reduce its “morbidity adjustment,” which predicts the health of its insurer pool and acts as a percent multiplier for premium determinations, from 1.1405 to 1.0446. Furthermore, CID approved increasing ConnectiCare’s risk adjustment from $119.19 to $120 per month for members, and its risk adjustment user fee from 18 cents to 20 cents per month for members.
ConnectiCare Benefits, a subsidiary of the ConnectiCare Insurance Company that offers both on- and off-market individual plans, requested a 22.7% average increase but was ultimately approved for a 16% average increase.
In addition to the aforementioned cost pressures, Anthem also said Public Act 26-33, a bill passed last session, necessitates rate increases. The bill goes into effect on Jan. 1, 2027, and mandates that state insurers cover intravenous immunoglobulin (IVIG) therapy, a treatment to boost the immune systems of immunocompromised patients; treatments for Pediatric Autoimmune Neuropsychiatric Disorders Associated with Streptococcal Infections (PANDAS) and Pediatric Acute-onset Neuropsychiatric Syndrome (PANS), which often include IVIG, chemotherapy-related scalp cooling treatments, and sports prosthetics. The bill also expanded the definition of infertility, increasing the number of treatments and diagnoses that must be covered.
“We recognize the clinical value these services may provide,” wrote Brandon Rousseau, Anthem Connecticut’s Sales Director. “However, each mandate creates a statutory claims obligation that must be reflected in actuarially sound premiums.”
Additionally, Anthem said the Independent Dispute Resolution (IDR) process, through which medical providers can dispute cost reimbursements for services rendered by out-of-network providers, has presented “a significant source of upward pressure on healthcare costs.” IDR was implemented by the federal No Surprises Act, passed by the U.S. Congress in 2022, with the intent of reducing out-of-pocket costs for patients who received emergency care from an out-of-network provider despite going to an in-network health facility.
“Although the Act has successfully protected consumers from unexpected medical bills, some out-of-network providers, particularly in high-cost, non-emergency specialties, have used the dispute process to obtain payments substantially above prevailing in-network rates,” wrote Rousseau.
Regardless of the insurers’ rationale, state residents and healthcare stakeholders, who submitted 140-pages’ worth of public comments, expressed across-the-board dissatisfaction, frustration, and distress at the increases. Monique Nadeau, dentist and owner of Farmington Village Dental Associates, broke down her family’s insurance plan and said: “The current trajectory of health insurance costs is exorbitant, astronomical and unsustainable.”
“In the event of a serious illness, injury, or medical emergency, our family could be required to spend more than $50,000 before insurance even begins covering expenses,” wrote Nadeau. “That figure is staggering. It is difficult to justify paying over $35,000 annually in premiums while still facing such substantial out-of-pocket exposure. The fact that insurance companies are looking to increase rates further is astonishing to me.”
Despite the broad dissatisfaction expressed towards the rates, CID Commissioner Hershman said that rate review “cannot solve rising health care costs on its own.”
“Premiums follow system-wide cost trends, and insurers must negotiate aggressively to manage care effectively and justify every dollar reflected in their rates,” said Hershman. “We need to move beyond the annual debate over rates and address the underlying drivers of health care costs, which is why the state is advancing the work required under Public Act 26-68 to develop a more affordable and sustainable health coverage model for Connecticut.”
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