2012 Healthy NY Rates Information
Jan 23rd, 2012
Health Insurance Plan of Greater New York (HIP) is a member of the EmblemHealth group of companies. It is a non-profit health insurance service corporation formed under Article 43 of the New York Insurance Law and under Article 44 of the New York Public Health Law, it is certified to operate a Health Maintenance Organization. HIP is dedicated to provide benefit plans that give its approximately 800,000 members, including 3,250 HIP Healthy NY members, access to covered health care services. The income they generate is used to serve their members, either for payment of medical services or administrative services and expenses needed for company operation.
Premium Rate components:
There are two components for your health insurance payment cost.
Medical care cost: The largest chunk of the members rate is the cost paid for medical claims submitted. As required by New York State law, a minimum of 82% of the premium paid must be a direct result of the amount paid for member medical costs.
Administrative costs. Administrative expenses take up the remaining amount of the premium paid by members. This cost includes costs paid for a various services and functions needed for operations; like claims processing; systems upgrade for state compliance; federal and legal requirements; consumer education which includes health education; provider network maintenance; medical reviews; web-based information operations; and taxes and other fees.
Rate increases the company applies for are based on thoroughly reviewed claims data and administrative expenses.
Proposed 2012 Rate Increase Components.
The requested increase of premium rate is based on the rising amount HIP is paying for medical care cost. The resulting increase amount will vary depending ont the type of plan, however it is grouped into three categories.
Rising Physician and Hospital Services Costs.
About 60% of the proposed increase is from the increasing costs the company pays the doctors and hospitals to continue providing patient care. The cost increase includes increases of the negotiated rates paid to providers and the higher costs of new technology and sophisticated treatments. Both of which are necessary to continue providing the highest level of care.
Frequent and More Expensive Services Used by Members.
About 32% of the proposed increase is based on the fact that more members are aging or are having serious illnesses, because of this they need to access more services and new technology to get the highest level of care. In most cases, their treatment includes costly medical procedures and services.
Increasing Costs of Prescription Drugs.
About 8% of the proposed increase is attributed to the rising costs for new and more complex prescription drugs and the fact that more members need to use those drugs.
The increase will be added to the members’ 2011 renewal premium rate if the proposal is approved. All HIP Healthy New York plans renewing in 2012 will be subjected to the rate increase. However, even with the new increase, HIP Healthy NY plans are still priced competitively compared to similar plans other insurers are offering.
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