Bill seeks to address rising health insurance rates

JUNEAU — State officials in Alaska are proposing a program to address high-cost health insurance claims in hopes of stabilizing rising rates on the individual policy market.

Just two companies — Premera Blue Cross Blue Shield and Moda Health Plan Inc. — serve the individual market in Alaska and have filed for double-digit rate increases each of the past two years. State officials say that’s not sustainable. They hope that reviving a high-risk pool to handle claims for the costliest conditions will bring some relief.

The idea is to spread the cost of those claims across all insured markets, rather than to have them just be borne by the smaller individual market.

The claims would be handled through the Alaska Comprehensive Health Insurance Association, which before the federal health care law provided insurance to Alaska residents who had been denied coverage. Under the proposal, insurers would transfer premiums for those consumers to the program, said Division of Insurance Director Lori Wing-Heier.

The hope is to ease high rate increases by taking high-risk claims from the individual market and having more than 220,000 Alaskans pay a portion of those claims rather than 22,000, she said. There would be an assessment passed on to insured Alaskans to contribute to the pool, she said. The cost of that is not yet known. But it’s not the intent to make it so expensive that people who have insurance would no longer be able to afford it, she said.

Wing-Heier told lawmakers Tuesday that without a change, the state runs the risk of the individual market going into a “death spiral,” with people potentially forced from the market by the high rates. The state struggles with high health care costs and that has translated to high insurance costs, she said.

Wing-Heier said the goal of the proposal from Gov. Bill Walker is to minimize the size of rate increases and provide some stability to the market. With the state down to two insurers in the individual market, there’s concern with how long they continue to incur the losses they have, she said.

Both Premera and Moda experienced “significant losses” in 2014 and 2015, according to the Division of Insurance. Last year, each filed for average rate increases of close to 40 percent. Early indications this year suggest continued losses and likely rate increases for next year of more than 25 percent, the division said.

More in News

Evan Frisk calls for full-time staffing of the Central Emergency Services’ Kasilof station during a meeting of the CES Joint Operational Service Area Board on Thursday, Nov. 21, 2024, at Soldotna Prep School in Soldotna, Alaska. (Jake Dye/Peninsula Clarion)
Kasilof residents ask for full staffing at fire station

Public testimony centered repeatedly on the possible wait times for an ambulance

The southbound lane of Homer Spit Road, which was damaged by the Nov. 16 storm surge, is temporarily repaired with gravel and reopened on Thursday, Nov. 21, 2024, in Homer, Alaska. (Delcenia Cosman/Homer News)
Homer’s Spit road reopened to 2 lanes

Repairs and reinforcement against erosion will continue through December

The under-construction Soldotna Field House stands in Soldotna, Alaska, on Thursday, Nov. 21, 2024. (Jake Dye/Peninsula Clarion)
‘We’re really moving along’

Officials give field house updates at Soldotna City Council meeting

Kenai Civil Air Patrol Cadet Elodi Frisk delivers Thanksgiving meals to seniors during the Hilcorp Areawide Senior Thanksgiving Luncheon in the Kenai Senior Center banquet hall in Kenai, Alaska, on Friday, Nov. 22, 2024. (Jake Dye/Peninsula Clarion)
Giving thanks together

Seniors gather for annual Hilcorp Areawide Senior Thanksgiving Luncheon

Shrubs grow outside of the Kenai Courthouse on Monday, July 3, 2023, in Kenai, Alaska. (Ashlyn O’Hara/Peninsula Clarion)
Anchor Point man indicted for 3 shootings at Homer family planning clinic, recovery center

The grand jury returned 12 counts total for the three shootings

The entrance to the Kenai Chamber of Commerce and Visitor Center is barricaded on Overland Avenue in Kenai, Alaska, on Thursday, Nov. 21, 2024. (Jake Dye/Peninsula Clarion)
Citing dangerous drivers, Kenai closes one entrance to visitor’s center

The barricade will be removed temporarily on Friday for Christmas Comes to Kenai festivities

A Kenai Peninsula Food Bank truck in the Food Bank parking lot on Aug. 4, 2022 in Soldotna, Alaska (Jake Dye/Peninsula Clarion)
Food bank seeks turkey donations as Thanksgiving nears

The local food bank is calling for donations of $25 to “Adopt-A-Turkey” for a local family in need

Seward City Hall is seen under cloudy skies in Seward, Alaska, on Thursday, Nov. 7, 2024. (Jake Dye/Peninsula Clarion)
Seward budget hearing covers bed tax, wages, emergency medical services

The Seward City Council on Nov. 12 considered a series of legislative items connected to 2025 and 2026 budget

The results of ranked choice tabulation show Sen. Jesse Bjorkman, R-Nikiski, winning reelection in the race for Senate District D. (Screenshot/Gavel Alaska)
Bjorkman, Vance win reelection after tabulation of ranked choice ballots

An effort to repeal ranked choice voting and the open primary system was very narrowly defeated

Most Read