As open enrollment nears, agents warn of rising health insurance rates

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Worries about an epidemic are spreading through Minnesota. But this one's not coming from Africa.

Consumers will soon get word about the cost of health insurance plans for 2015, and agents are warning of an outbreak of sticker shock.

KSTP reports the trade group representing the state's health insurance agents appeared at MNsure's board meeting Wednesday to scold leaders of the insurance exchange for touting premium increases averaging just 4.5 percent.

The station says Alycia Reidel of the Minnesota Association of Health Underwriters told board members they'd created a mistaken impression among the majority of consumers who do not use the insurance exchange to buy their policies:

"Most of them are outside of MNsure at this point and they haven't received their renewals yet," Reidel said. "As they start to receive them they're going to understand they have significant increases facing them."

Insurance premiums vary according to the provider, the type of coverage, the consumer's age, and where they live, which makes it harder to generalize about rates.

Some in the industry say many Minnesotans could face rate increases in the double digits.

PreferredOne offered the lowest premiums on MNsure in 2014 and had more enrollees than any other plan. But the insurer wasn't making money in the system and announced last month it won't be part of MNsure in 2015.

PreferredOne said Wednesday the average increase in premium rates for purchasers of individual health insurance for 2015 will be 63 percent, the Star Tribune reports.

4.5 percent challenged, defended

The announcement by MNsure and the state Commerce Department that rates were rising by an average of 4.5 percent for 2015 was quickly challenged, particularly by Republican candidates in the November election.

They're not alone, though. The insurance agents trade group issued a statement leveling some of the same criticisms Reidel made at Wednesday's MNsure meeting.

The figure was reached by averaging the rate changes of the four insurance providers that stayed in MNsure for 2015. Of those, the Pioneer Press reports Blue Cross Blue Shield is raising its premiums by an average of 17.2 percent, HealthPartners by 8.1 percent, Medica by 1.8 percent, and UCare is lowering them by 9.2 percent. The average of those numbers comes to 4.5 percent.

University of Minnesota math professor David Brokken argued in a MinnPost essay last week that a weighted average would be a better measure, since Blue Cross Blue Shield, which is raising rates the most, has more than half of the returning policyholders. UCare, which is reducing rates, had only 3 percent of the market.

The Commerce Department does not agree that a weighted average would be more accurate, telling the Pioneer Press that using 2014 enrollment to weight average rates for 2015 isn't appropriate because MNsure allows consumers to shop for coverage anew each year.

Meanwhile, MNsure is assuring those shoppers that improvements to its website and call center will make enrollment smoother this year than it was during the exchange's rocky rollout season.

Open enrollment begins Nov. 15.

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