ConnectiCare, which offers health plans on and off the Connecticut Health Insurance Exchange, has alerted brokers that it will soon stop selling small group policies to new customers.
“ConnectiCare has made the difficult decision to withdraw from the fully insured small employer market in Connecticut,” spokeswoman Kimberly Kann said in a statement. “This decision has been made after a thorough actuarial and financial review, which has clearly shown that we can no longer offer fully insured small employer products at competitive prices in this market.”
The company said it will no longer sell new small group policies — on-exchange or over-the-counter — starting December 1. It will offer renewals to small group customers with plan dates effective through May 1, 2022.
News of the withdrawal was first reported by the Hartford Business Journal.
“We understand that this news comes at a difficult time, and we remain committed to serving small employers in our state,” Kann said. “We are making these changes to ensure the health and longevity of our business so that we can continue to provide the high-quality health plans that employers and individuals across our state depend on.”
About 20,000 people are covered by the company’s fully insured small group plans. ConnectiCare has sold small group policies through Access Health CT, the state’s exchange, since 2018, and has 3,476 members there.
ConnectiCare has sought an average rate hike of 22.9% on its small group policies offered through the exchange this year. The state insurance department approved an average of 15%, with plan increases ranging from 13.1% to 18.9%.
Officials at Access Health CT, whose mission is to help all residents gain access to coverage, said they will contact those affected by ConnectiCare’s exit from the small group market.
“It’s about making sure residents are able to look at alternative options and not get confused with this and have all the facts…to know what’s out there,” John said. Carbone, Director of Small Group and Product Development for Access Health. “We will work with our brokers, as this population is heavily broker-focused.”
Chris DiPentima, president and CEO of the Connecticut Business & Industry Association, said ConnectiCare’s decision leaves small businesses with fewer choices when selecting an insurance plan.
“It’s a very tough market, especially for our small and medium-sized businesses,” he said. “It makes things a little more difficult. This leaves a smaller pool of carriers.
The CBIA and others have called on state officials to examine the cost drivers behind the rising price of health insurance and ask the General Assembly to tackle affordability in the next session legislative.
“Rising health care costs are up there [in terms of concerns] we hear about the business community, as well as energy costs and the labor crisis,” DiPentima said. “Those are really the top three problems for small businesses in Connecticut, and it potentially exacerbates them.”
Many people who purchase individual plans through the Connecticut Health Insurance Exchange are eligible for financial assistance to offset the cost of monthly premiums, but small businesses are not.
“Small businesses are the ones that really get the small end of the stick,” said Ted Doolittle, the state’s health care advocate. “They don’t have the grant protection that individual people do. One of the effects of this will be that some of the smaller groups will simply stop offering insurance and allow their employees to get whatever plans they can in the market where they might be subsidized.
Karen Moran, president of ConnectiCare, told a public hearing in August that the company suffered more than $65 million in losses in the individual market over the past year because rate increases didn’t not keep up with the increased use of medical services and the cost of prescription. medicines, among other expenses.
“For an insurance program to be viable, rates must be sufficient to cover the payment of claims and the administrative costs of running the program. Over the past year, the total insurance premiums we’ve received are far less than the cost of care we’ve actually funded,” she said, explaining why the company was looking for significantly higher rates. .
ConnectiCare also asked for an average hike of 24% on its individual plans. The state approved 15%.
Sen. Matthew Lesser, a Middletown Democrat who serves as co-chair of the Insurance and Real Estate Committee, said lawmakers plan to explore health insurance cost factors in the next legislative session.
“It’s just one more indication that the small group market is not meeting the needs of small businesses in Connecticut,” he said of ConnectiCare’s withdrawal. “That’s why we need real fundamental reform to address their health insurance. It’s an ongoing problem, and it’s only getting worse.
This story originally appeared on the Connecticut Mirror website, www.ctmirror.org.
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