The analysis for the Commonwealth Fund, a private foundation supporting independent research on health policy reform, is the first to take a national look at the explanations insurers file with federal and state authorities to justify rate increases of 10 percent or more, as required by the Affordable Care Act.
Michael J. McCue of Virginia Commonwealth University and Mark A. Hall of Wake Forest University reviewed 311 filings from insurance plans covering 150 or more people in the individual and small-group markets for the study.
The researchers found only about half the filings, or 155, attributed any portion of rate increases to provisions of the Affordable Care Act that had gone into effect by 2013. Overall, those effects accounted for a small part of insurers' increases. Many insurers said higher medical expenses accounted for the entire premium increase, the study said.
Specifically, insurers reported preventive and contraceptive services for women were responsible, on average, for 0.8 percent of the health insurance premium increases, while taxes and fees related to the law were responsible for 1.5 percent.
"Thanks to the transparency that these filings provide, we can look at premium costs with a level of depth and specificity that was previously impossible," McCue said in a statement. "What we found is that these larger rate increases were driven by rising medical costs."
Filings for premium cost increases also revealed:
-- The average annual premium increases among health insurance carriers with increases of 10 percent or more were $648 in the individual market and $729 in the small-group market. Insurers on average attributed the entire amount of rate increases in the individual market to higher medical expenses. In the small-group market, insurers reported that medical costs accounted for 72 percent of requested rate increases.
-- Rising prices were a larger driver of medical expense increases than enrollees' greater use of services. Insurers attributed more than half of the average medical expense increase to higher per unit costs for services in both the individual market at 57 percent and small-group market at 58 percent. About a quarter of expected medical cost increases in the individual market and 31 percent in the small-group market were attributed to increased use of services.
-- Increases in administrative costs and profits accounted for 28 percent of premium increases, on average, among insurers with high-rate increases in the small-group market.
-- Insurers in the individual market with large rate increases reduced overhead costs and profits in response to medical cost increases by an average of $25 annually per member.
Between 4 percent and 5 percent of consumers in the individual and small-group markets were affected by rate increases of 10 percent or more nationally between July 2012 and June 2013, the study said.
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