The state will merge the insurance coverage markets for people and small teams to create extra steady pricing for well being protection, notably wanted among the many declining group market utilized by small companies.
Maine will likely be first within the nation to mix the 2 markets, officers stated. The merger was approved by the Made for Maine Well being Protection Act, signed into regulation by Gov. Janet Mills in 2020.
The Maine Bureau of Insurance coverage stated the marketplace for particular person medical insurance has been steady, however premiums for small group insurance coverage have been rising and enrollments have been declining. Placing the 2 teams collectively will promote extra stability, the bureau stated.
The choice to merge the 2 markets, which can take impact in 2023, is meant to assist small companies, a key purpose of Gov. Janet Mills’ administration, Maine Insurance coverage Superintendent Eric Cioppa stated. Due partly to tax subsidies offered by the Inexpensive Care Act, the variety of particular person insurance coverage insurance policies has been rising, he stated, whereas insurance policies issued for small teams, equivalent to staff of small companies, have been declining.
Maine had about 48,300 individuals insured within the small group market as of final March and about 63,000 within the particular person market, the bureau stated.
The merger will pool the dangers of the 2 markets and in addition put the the small group market into the Maine Assured Entry Reinsurance Affiliation, or MGARA, a state-created physique that helps present reinsurance, a solution to share the dangers of enormous insurance coverage claims. MGARA was initially launched in 2012, however was suspended in 2014 after which relaunched in 2019.
The bureau stated the person and small group markets have been shifting since 2019 with the revival of MGARA for particular person insurance policies and the enlargement of MaineCare, which supplies free or low-cost medical insurance for low-income people. The small group market has been experiencing declining membership and rising premiums – common price will increase had been 31 p.c over the interval from 2019 to 2022.
On the identical time, premiums for the person market declined by 14 p.c over the identical four-year interval, the bureau stated.
Cioppa stated the bureau initiatives that pooling the market will end in common premium reductions of 8 p.c for people and about 6 p.c for small employers in 2023. Premiums are projected to say no one other 6.1 p.c for people and three.9 p.c for small employers in 2024, he stated.
Cioppa stated the state has utilized for approval of the plan with the federal authorities. Though approval hasn’t but been granted, he stated discussions with federal regulators have led him to imagine will probably be forthcoming.
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