December 3rd, 2012 – Colorado’s Division of Insurance rejected a rate increase request by Cigna that included a 31% increase in premium for 4 of Colorado’s mountain counties.
The steep boost was “extremely high compared to other carriers,” said Tom Abel, supervisor of rate reviews for the Colorado’s Division of Insurance.
“They didn’t support anything. We didn’t even know if this was an educated guess or just a guess. The state’s rejection of the unsubstantiated Cigna request was a perfect example of the system working,” Abel said.
A Cigna spokesperson said, “Medical costs in those mountain counties exceeded premiums collected last year.”
Since 2008 Colorado has a “prior approval” requirement that gives the Division of Insurance authority to reject hikes for being excessive or discriminatory.
The federal Affordable Care Act of 2010 (ObamaCare) also requires reviews of rate increases that exceed 10 percent a year.
Source: Denver Post article by Michael Booth