About 1 million New Yorkers will see their monthly health insurance premiums jump as much as 35% next year under rate hikes the state announced Friday.
State Department of Financial Services issued limits about how much a dozen or so health insurers can collect in premiums — or monthly subscription fees — for plans covering individual households and employers with up to 100 employees.
The state agency approved an average monthly premium increase of 12.7% for individual plans that cover about 260,000 New Yorkers and can be purchased on and off the state health exchange.
DFS has authorized an average monthly premium increase of 8.4% for small group plans that cover approximately 700,000 New Yorkers.
The agency has yet to decide how much carriers can raise costs for the subset of larger health insurance plans and Medicare supplement policies that DFS oversees.
The agency declined to have a spokesman answer questions about why it approved the rate hike.
In its announcement, DFS cited rising costs of hospital stays, drug prices and other medical care. The memo said regulators expected carriers to have relatively modest margins, noting that “DFS has held insurance company profit reserves to just 1.0%.
The decision will bring the average monthly premium for individual plans statewide from $750 to $845, with rates varying by insurer, household composition, region and other factors, DFS said.
Although premium increases were not authorized for UnitedHealthcare of New York, DFS approved double-digit increases for nearly all other carriers, including Emblem, which will increase premiums by an average of 35.6%.
Emblem paid more in claims than it collected in premiums for its individual health plans in 2022 and 2023, according to its filing with DFS.
But the health advocacy coalition, Health Care For All New York, said the carrier’s forecasts showed it expected to have a harder time managing care costs than its peers. Emblem also plans to pay more for administrative operations and needs funding for prenatal vitamins — a roughly $250 commitment that did not appear to be a financial concern for other insurers, the coalition said.
“The department should require carriers like Emblem to review its own operating practices that make it a market outlier, instead of having its enrollees bear such a large rate increase,” Health Care For All New York said in its testimony .
Emblem spokeswoman Kimberly Kann said premium rates were set based on price trends and how much care patients needed.
“We remain extremely conscious of the impact that rate increases are having on our members,” Kann said in a statement. “We work closely with hospitals, physicians and other health care providers to help control costs.”
DFS authorized rate increases that will bring the average monthly premium for small group plans statewide from $1,000 to $1,084, the agency said.
Regulators kept average increases in the single digits for five carriers, but allowed rate increases that averaged 20% at two northern state insurers. Premium costs will cap closer to 10% or 11% for many insurers operating in Long Island and the greater metropolitan area.
DFS said in its announcement that many individuals and some employers could receive tax credits to reduce the cost of their insurance premiums.
Health plans need more funding as hospitals and health systems demand price increases and prescription drug costs skyrocket, said Eric Linzer, president and CEO of the New York Health Plan Association, a trade group for health insurers.
“The proposed premium rate health plans submitted in May reflected the high cost of health care in New York,” Linzer said in a statement. “Unfortunately, the final approved rates do not fully take these factors into account.”
About 1 million New Yorkers will see their monthly health insurance premiums jump as much as 35% next year under rate hikes the state announced Friday.
State Department of Financial Services issued limits about how much a dozen or so health insurers can collect in premiums — or monthly subscription fees — for plans covering individual households and employers with up to 100 employees.
The state agency approved an average monthly premium increase of 12.7% for individual plans that cover about 260,000 New Yorkers and can be purchased on and off the state health exchange.
DFS has authorized an average monthly premium increase of 8.4% for small group plans that cover approximately 700,000 New Yorkers.
The agency has yet to decide how much carriers can raise costs for the subset of larger health insurance plans and Medicare supplement policies that DFS oversees.
The agency declined to have a spokesman answer questions about why it approved the rate hike.
In its announcement, DFS cited rising costs of hospital stays, drug prices and other medical care. The memo said regulators expected carriers to have relatively modest margins, noting that “DFS has kept insurance company profit reserves at just 1.0%.
The decision will bring the average monthly premium for individual plans statewide from $750 to $845, with rates varying by insurer, household composition, region and other factors, DFS said.
Although premium increases were not authorized for UnitedHealthcare of New York, DFS approved double-digit increases for nearly all other carriers, including Emblem, which will increase premiums by an average of 35.6%.
Emblem paid more in claims than it collected in premiums for its individual health plans in 2022 and 2023, according to its filing with DFS.
But the health advocacy coalition, Health Care For All New York, said the carrier’s forecasts showed it expected to have a harder time managing care costs than its peers. Emblem also plans to pay more for administrative operations and needs funding for prenatal vitamins — a roughly $250 commitment that did not appear to be a financial concern for other insurers, the coalition said.
“The department should require carriers like Emblem to review its own operating practices that make it a market outlier, instead of having its enrollees bear such a large rate increase,” Health Care For All New York said in its testimony .
Emblem spokeswoman Kimberly Kann said premium rates were set based on price trends and how much care patients needed.
“We remain extremely conscious of the impact that rate increases are having on our members,” Kann said in a statement. “We work closely with hospitals, physicians and other health care providers to help control costs.”
DFS authorized rate increases that will bring the average monthly premium for small group plans statewide from $1,000 to $1,084, the agency said.
Regulators kept average increases in the single digits for five carriers, but allowed rate increases that averaged 20% at two northern state insurers. Premium costs will cap closer to 10% or 11% for many insurers operating in Long Island and the greater metropolitan area.
DFS said in its announcement that many individuals and some employers could receive tax credits to reduce the cost of their insurance premiums.
Health plans need more funding as hospitals and health systems demand price increases and prescription drug costs skyrocket, said Eric Linzer, president and CEO of the New York Health Plan Association, a trade group for health insurers.
“The proposed premium rate health plans submitted in May reflected the high cost of health care in New York,” Linzer said in a statement. “Unfortunately, the final approved rates do not fully take these factors into account.”
Sarina Trangle covers affordability and cost of living issues and other business topics. She previously worked as an editor and reporter at amNewYork.