2016 ACA rate increase justification

According to the Centers for Medicare and Medicaid Services (CMS), qualified health plans such as Providence Health Plan must post a notification on its website explaining the necessity of rate increases.

Providence Health Plan is committed to providing a premium rate that is affordable for all consumers on the individual market. This includes lowering the profit margin to the minimum amount allowed by state and federal regulation, negotiating the best rates with hospitals and other providers within our network and continuing initiatives to improve patient health and member satisfaction while also reducing waste.

The primary factors driving Providence Health Plan individual and family plan premium rate changes for 2016 include:

  • There was a significant change in membership. Even after adjusting for changes in population characteristics, the utilization of medical benefits and services was higher than anticipated.
  • An increase in the cost of claims, due to medical/prescription drug inflation and increased medical/prescription drug utilization.

Providence Health Plan submits rates to the Oregon Insurance Division for approval. A summary of their review process and final decision on rate filings are posted on their website at: http://www.oregon.gov/DCBS/Insurance.