Yesterday, NYS Dept of Financial Services approved 2023 health insurance rate requests yesterday. Small group rates increased by 7.9% and 9.7% for individuals.
As per NY State Law, Health Insurers are required to send out early notices of rate request filings to groups and subscribers see original –2023 NY Small Group Carrier Rate Filings. Despite only 3 months of mature claims data experience for 2022 health insurers’ original requests were noticeably above the average of 16.5%/individuals and 19% for small groups. For example, regulators last year approved average rate increases of 3.7% for individuals and 7.6% for small group plans. Over 1.1 million New Yorkers are enrolled in individual and small group plans impacted by the rate increases, the state agency noted.
The recent COVID-19 surge irony reflected a lower cost utilization due to COVID-19. The average medical-loss ratio, which represents the portion of premiums spent on medical claims and quality improvement, was 70% in recent years years. That said, in an anticipation of spikes in claims submissions + overall inflation, a larger than average increase is needed. This is in addition to increases in pricing by hospitals, consolidated IPA groups, and pharmaceuticals.
The state noted that the premiums increase main drivers are medications. “Rising medical costs and inflation continue to put upward pressure on premiums,” said Superintendent Harris. “With our rate actions announced today, we continue to prioritize the financial wellbeing of consumers while ensuring that New Yorkers have access to a robust, stable health insurance market.” Also, DFS, recognizing the continued uncertainty of the pandemic’s effect on consumers’ health care costs and the economy, held insurers’ profit provisions to a historically low 0.5%.
Oxford/Unitedhealthcare, notably, got only a 6% rate increase approval for next year. This is a sharp reduction from the original 16.8% request in part by disagreed anticipated costs, held reserves, overall market pricing, and reinsurance gained from ACA’s Risk Corridor. See more info here, https://www.medicalsolutionscorp.com/risk-adjustment-reinsurance-and-risk-corridors/.
Small Group Market
Almost 850,000 New Yorkers are enrolled in small group plans, which cover employers with up to 100 employees. Insurers requested an average rate increase of 16.5% in the small group market, which DFS cut by 52% to 7.9% for 2023, saving small businesses $632.4 million. A number of small businesses also will be eligible for tax credits that may lower those premium costs even further, such as the Small Business Health Care Tax Credit.
DFS SMALL GROUP MARKET RATE ACTIONS
*Indicates the Company will offer products on NY State of Health Marketplace in 2023.
PEO Alternatives to Small Group
Before you consider renewing automatically, you should first find out what is a PEO so that you can know exactly what to expect from it. PEO’s are large-group markets underwritten. With the right PEO, you will be able to manage your business’s demand for growth and your employees as well.
Clients on average save 15-40% off the small group market. If you are looking for a complete insurance solution for your business, go to our website and check out our business insurance solutions. Contact us for more information today.
Learn how a PEO can make a difference for your group. For more information on how Employer-Sponsored Insurance and a PEO can make difference for your small business please contact us at firstname.lastname@example.org or 855-667-4621.
Put You & Your Employees in Good Hands
Get In Touch
For more information on PEOs or a custiomized quote please submit your contact. We will be in touch ASAP.