Dave Dillon, a fellow of the Society of Actuaries, shared three insights with Becker’s Hospital Review on what to expect for 2021 health insurance rates, and how COVID-19 may affect them. Mr. Dillon works directly with insurers and regulators to develop and review rates.
Three things to know:
1. Generally, most insurers will implement between a 1 percent decrease and a 5 percent increase for 2021. However, increases vary significantly by region. Some insurers did request double-digit decreases, while others sought increases of more than 25 percent.
2. Four key drivers are affecting 2021 rates:
- Medical inflation — 3 to 6 percent increase
- Reduction in exchange user fee for federal marketplaces — 0.5 to 1 percent decrease
- Removal of health insurance fee — 1 to 3 percent decrease
- COVID-19 — 2 percent decrease to 10 percent increase
3. In terms of COVID-19, Mr. Dillon saw a wide range of submitted rate increases based on the expected effects from the pandemic. Still, about half of insurers didn’t explicitly submit a rate increase due to COVID-19.
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