Hogan Announces Lower Health Insurance Rates


ANNAPOLIS, Md. (AP) — Gov. Larry Hogan announced lower health insurance premiums on Friday for individual plans next year in Maryland.

Hogan and Al Redmer, the state’s insurance commissioner, said the 2019 rates are down an average of 13.2 percent as a result of the state’s reinsurance program, with decreases ranging from 17 percent to 7.4 percent. The initiative was the result of bipartisan support from the Republican governor and the Democrat-controlled General Assembly.

Reinsurance provides a safety net for insurers by helping to pay large claims. Before it was approved, insurers had requested an average rate increase of 30.2 percent for about 192,000 people in the individual market. The Hogan administration says rate increase requests ranged from 91.4 percent to 18.5 percent.

“Because of the inability of Washington to address our health care crisis, Marylanders were facing the potential of health insurance rates nearly doubling,” Hogan said. “Without immediate action, the individual market in our state was literally on the brink of collapse. Tens of thousands of Marylanders could have lost their health coverage, and all Marylanders in the individual market would have received crushing rate increases.”

Because of the reinsurance program, average individual policy renewal rates are 43.4 percent lower than what companies initially filed with state regulators and 13.2 percent lower than 2018 premiums. Officials estimate the savings for 2019 individual market premiums is about $481 million.

Redmer cautioned that it’s only a short-term fix.

“What we really need and what we’ve been advocating for years is for Congress again to put aside those partisan differences and come up with common sense solutions or give us more authority to make changes here in the states,” Redmer said.

Last month, Maryland officials announced federal approval of a waiver needed to create the reinsurance program, which they say is the largest in the country. Maryland became the seventh state to receive approval for a state-based reinsurance program. The others are AlaskaMaineMinnesotaNew JerseyOregon and Wisconsin.

State lawmakers passed legislation this year to use about $365 million that health insurance companies no longer have to pay the federal government due to last year’s changes to the federal tax code. The money will help create a pool to provide funding for the biggest claims in the individual market.

Open enrollment for 2019 runs from Nov. 1 through Dec. 15, when Maryland residents may sign up for new plans or renew existing ones. There are two carriers that serve the state’s individual market: CareFirst BlueCross Blue Shield and Kaiser Permanente.

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