2021 Health Insurance Rates Generally Flat, Even Decreasing

Many insurers have recently announced various forms of premium relief — discounts and credits — because of the favorable margins they have piled up amid the COVID-19 pandemic and the resulting lack of claims related to routine healthcare.

Now it is also looking like their 2021 rates will be flat or even lower than they were in 2020, according to Sabrina Corlette, J.D., co-director of the Center on Health Insurance Reforms at Georgetown University.

“What we are seeing as rates come through and as states announce what the final rates will be is that, generally, rates are flat or, in some cases, decreasing,” Corlette said in a recent video interview with Managed Healthcare Executive®.

“I don’t think that the recent announcements about premium holidays or premium relief had much of an impact on 2021 rates. I think those were already built and underwent regulatory review” before the premium relief announcements, Corlette added.

Corlette thinks additional premium relief this year is unlikely. Companies are still under pressure to conserve resources because of the large amount of uncertainty in healthcare, she noted, before ticking off some factors in that uncertainty: the cost of a possible vaccine, the possible development of new expensive treatment, or a bad flu season.

Noting that COVID-19 has had a disproportionate effect on older people and people of color she said the public payers, Medicare and Medicaid, may have been disproportionately affected by the disease.

“Just as COVID-19 is not hitting every community or population equally, I think the same is true for how it is affecting insurers.”

One of COVID-19 storylines that has gained some currency in healthcare circles is that the experience of the pandemic and the disappearance of payment from fee for service will make value-based care, and some version of capitation, more appealing. Corlette said that makes logical sense, but she cautioned about the lack of data showing that it has happened.

She also noted the reluctance to take on any downside risk. “I just haven’t heard that there has been a real shift in attitude on that front, but this may just be one of those things that takes some time to play out”