CT’s medical insurance market is not in good shape

Connecticut received a score of 40 out of a possible 100 in a recently completed comparison by the Council for Affordable Health Insurance (CAHI) of how the health insurance market is working in 50 states!

In developing this evaluation the criteria was discussed with numerous actuaries and health policy experts to enable CAHI to state the report is a fair and accurate snapshot of each states health insurance environment. The following six measures of a viable medical insurance market were used in the comparison. The scores from each add up to a maximum of 100:

• Percentage of uninsured – a maximum of 10 points was awarded for states with the lowest percentage. CT received – 10 points.

• Number of state mandates – a maximum of 10 points for states with the fewest mandates. CT received – 0 points.

• State regulatory environment – those with the best regulatory environment received 20 points. CT received – 10 points.

• High risk pools – states with a well functioning pool provide a valuable safety net for individuals and those doing a good job received up to 20 points. CT received – 20 points.

• Individual and small group premiums – those with the lowest premiums could receive up to 20 points in each market segment. CT received – 0 points in both the individual and small group markets.

What does CT’s score of 40 tell us about how we compare to others? States receiving 65 or more points are considered to generally have a well functioning medical insurance market. Those with 45 to 65 points are functioning but in need of improvements. Those with 40 or less are considered to be generally dysfunctional.

What can CT do? CT received zero points for mandates since we have the third highest number in the US. Because of this the premium cost for these mandates vs. the number of individuals using them need to be evaluated. One more immediate idea is for the General Assembly to pass legislation to allow mandate lite plans to be sold. Having plans with lower rates would result in a better score in the individual and small group premium index.

In thinking about this evaluation keep in mind it has long been known:

• The cost of health insurance is the primary reason individuals are uninsured

• State legislatures have a significant impact on the cost of medical insurance premiums.

• The best way to reduce the number of uninsured is to improve the private market so a range of affordable policies can be offered.