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Iowa Health Insurer To Seek Smaller Rate Hikes

By RYAN J. FOLEY

IOWA CITY, Iowa (AP) â¿¿ Months after customers blasted the company for years of skyrocketing rates, Iowa's dominant health insurer said Tuesday it will limit premium increases in 2014 to less than six percent for individual and small business policyholders.

Wellmark Blue Cross and Blue Shield said in a statement it would not raise premiums to cover any increases in general medical or administrative costs in 2014. Instead, the Des Moines-based mutual company said it would only raise rates to offset the new fees required of insurance carriers under the Affordable Care Act.

The decision will impact 330,000 members in Iowa and South Dakota who purchase health insurance directly from Wellmark, or who get their insurance through small businesses with less than 50 employees. Wellmark, which insures roughly 1.8 million customers in Iowa and 300,000 in South Dakota, did not specify how larger group policies would be affected.

The plan comes after an increase of 12 or 13 percent went into effect for 146,000 Wellmark individual and business customers on April 1.

Hundreds of Wellmark customers had spoken out against the company online or at a January public hearing. Critics said they were tired of Wellmark's annual rate increases, which were 9.4 percent in 2012, 8.5 percent in 2011 and 18 percent in 2010. They decried the impact on their family budgets and questioned Wellmark's administrative costs. But Iowa's insurance commissioner approved the rate hikes, citing increasingly expensive health care costs.

Wellmark executives said they were able to hold down rates next year due to a number of factors, including an assumption that their pool of individual and small business customers may be healthier and have less expensive benefits. They said their efforts to tie provider payments to outcomes and promote healthy lifestyles may also be paying off.

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