MVP seeks big rate hike for Catamount health

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(Host) There are signs that the cost of the state’s Catamount Health Care program could go up dramatically next year because MVP Health Care has filed a 31% rate increase for its share of the program.

MVP officials say drug costs and increased use of the program are driving expenses much higher than expected.

VPR’s Bob Kinzel reports.

(Kinzel) The Catamount Health Care program is administered by two private health insurance companies: Blue Cross and Blue Shield of Vermont and MVP.

Both companies review their cost structures for the program every three months and the next deadline for a possible rate increase is the middle of September.

Banking and Insurance commissioner Paulette Thabault says MVP is seeking a 31% increase in its Catamount rates and she says the size of the request came as a surprise:

(Thabault) "Yes it did it seem a little bit higher than we had expected. Our actuary is reviewing that rate right now and has some questions that are outstanding to the company and we’re expecting MVP to be responding to those questions and ultimately the rate will be approved at some level."

(Kinzel) If a large rate increase is approved by the state, Thabault doesn’t think it will necessarily result in higher premiums for the program. Instead, she says it’s possible that the state will have to absorb most of these additional costs:

(Thabault) "Any increase is always a hardship but I think that the premiums for Catamount are still quite affordable and…I don’t think that this will cause a drop off in enrollment. Whenever there’s an increase there’s going to be added pressures to the subsidized portion as well and so the state would experience that."

(Kinzel) Bill Little is the vice president for MVP Vermont. He says that MVP has not sought a rate increase since Catamount was launched roughly 2 years ago and he says there are two major factors driving this rate hike request:

(Little) "I think that for this population we have about 2500 members. We’ve seen higher utilization across all categories. I think particularly high has been the pharmacy area, so the drugs have been higher than regular medical."

(Kinzel) Little says MVP has already filed an amended rate plan with the state but he declined to say what it was. He says he expects to be engaged in some active negotiations with the state to reach a final number:

(Little) "The reality of it is that this is a process that typically results in a certain amount of back and forth between BISHCA’s actuary and MVPs actuary. And it’s an iterative process that we will come up with a number which is appropriate and very defensible."

(Kinzel) Blue Cross officials say they’re just beginning to review their Catamount experience and they don’t expect to make a decision about any possible rate hike for several weeks.

For VPR News I’m Bob Kinzel.

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