HELENA — Blue Cross and Blue Shield of Montana, the state’s largest private health insurer, told thousands of customers this week it is raising premiums 3.5 percent in January because of “Obamacare” fees and taxes.
The notice, dated Thursday, went to nearly 3,000 holders of group policies, which insure tens of thousands of Montanans. Blue Cross said it didn’t have an exact count of how many people are covered by the affected plans.
Some of those policyholder signed year-long contracts earlier this year and are getting a mid-year increase, which Montana law generally forbids.
But the law has an exception that says an insurer can increase premiums in the middle of a contract year if costs are affected by a change in state or federal law.
Blue Cross linked the increase to fees taking effect Jan. 1 — although insurers have known for some time about the charges.
“We are following the law,” said John Doran, director of strategic marketing services for Blue Cross Montana. “We made that decision feeling it was in the best interest of our members. … We waited until the last available minute to assess these fees.”
Other major health insurers in Montana aren’t invoking the law, saying they already built any costs from the Affordable Care Act (ACA) — also known as Obamacare — into their current premiums.
“We’re honoring our current rates,” said Todd Lovshin of PacificSource, which insures about 19,000 people in Montana. “We’ve known about the (fees) for a long time and we knew they were going to be collected.”
The Blue Cross notice referenced two ACA charges effective Jan. 1: A flat-rate federal tax on all health insurers, to raise $8 billion nationwide to help pay costs of the overall act, and an annual “reinsurance fee” of $63 per person insured.
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