An independent auditing firm has upheld the rate increases Wellmark sought for about 80,000 private health insurance policies held by Iowans. The increases, which averaged 18 percent, will go into effect May 1.
Rob Schweers, a spokesman for Wellmark, says the independent review confirmed the methods Wellmark used to calculate its rates. “Nobody likes a rate increase,” Schweers says. “We’re hard-wired not to want to pay more for anything — certainly health insurance included, but we hope our policy holders understand that these rate increases are necessary to address the rising trend in health care costs.”
The Iowa insurance division originally approved the Wellmark rate increase but in early March, Governor Culver asked for a delay in implementing the rate hikes to allow an independent actuary to review the proposal. The 10-page review examined Wellmark’s request along with the Iowa insurance division’s decision.
“We hope that one of the lessons from this exercise is that we are working above the board,” Schweers says. “We target a very low operating margin anyway and, in fact, we’ve been losing money the last two years because our premiums haven’t been high enough to accommodate the increases in the care that we’re paying for on behalf of our members.”
The rate increases apply to private insurance policies for individuals, not to group policies offered by Wellmark. The new, higher rates will take effect May 1 and last for 11 months.
See the complete report here: Wellmark review PDF