Blue Cross cites health reform in proposed rate increases

Blue Cross Blue Shield of North Carolina on Thursday asked the state Department of Insurance to approve rate increases for two of its health insurance plans.

The state's largest insurer, Blue Cross wants premiums to go up by almost 7 percent for its Blue Advantage program and by about 2 percent for its Blue Options HSA program. Together, the two plans serve more than 300,000 customers.

“Most of our Blue Advantage and Blue Options HSA customers will see smaller rate increases for 2011,” Blue Cross President and Chief Executive Brad Wilson said in a statement. “However, the only way to make premiums affordable over the long term is to get soaring medical costs under control.”

While citing rising medical care costs as a primary driver in the proposed rate increases, company officials said provisions of the federal Patient Protection and Affordable Care Act health care reform law also will impact rates charged under the two plans. Those provisions include requiring insurers to remove the cap on lifetime benefits, enhance preventive care coverage and allow unlimited mental health services, prescription drugs and other types of care.

Also, premiums for people under age 26 will change because the health care reform law requires insurers to rate them as a single group, Blue Cross officials said. Previously, the company divided all people 25 and under into five groups to set premiums, they said.

"Given what is known today about the health care reform law, premiums will be generally higher for individual policies after 2014," the company said in a statement. "Rates generally will be lower for less healthy consumers and higher for healthier consumers than they would have been without reform."