Mass. OK’s health plan increase of just 1.2%

Premiums still rising modestly

State regulators on Monday approved third-quarter health insurance rates that will raise premiums an average of just 1.2 percent in the market serving small businesses and individuals, continuing a trend of more modest increases seen over the past three quarters.

And several carriers, including Tufts Health Plan of Watertown and Fallon Community Health Plan, based in Worcester, will reduce their rates - a rarity in Massachusetts health care - according to data from the state Division of Insurance.

The new rates are in the Massachusetts "small group'' market, which includes tens of thousands of small companies as well as self-employed and formerly uninsured individuals.

They apply only to those policies that renew or take effect between July 1 and Sept. 30.

The largest group of policies in that market renew in the quarter beginning April 1, and for those accounts health insurance premium increases averaged 1.9 percent.

In the 2011 third quarter, rate increases averaged between 8 and 9 percent.

Health insurance premiums, which advanced at double-digit annual rates for much of the last decade, slowed in the past year as uses of some types of medical care declined and state government and business leaders pressed insurers and providers to rein in costs.

Among the results have been new, cheaper insurance products that limit where members can receive care or charge them more for care in expensive settings. Insurance carriers also have negotiated so-called global payments with hospitals and doctors groups, giving them fixed budgets to provide care rather than reimbursing them for each visit and procedure.

Barbara Anthony, the state's undersecretary of consumer affairs and business regulation, credited the Patrick administration's pressure on the industry as well as efforts by insurers and health care providers to redesign their insurance and care delivery models.

"This is another good quarter for small businesses and working families,'' Anthony said. "We continue to move in the right direction. There is no silver bullet to controlling health care costs, but it takes everyone in the system working together.''

Third-quarter increases were approved by the state Division of Insurance for so-called base health insurance rates.

Many businesses and individuals will pay more, depending on their location, industry sector, workforce age, and other additional factors.

Increases for the quarter averaged 1.2 percent for the HMO business of Blue Cross Blue Shield of Massachusetts, 2.7 percent for Blue Cross Blue Shield's non-HMO business, 3.1 percent for Harvard Pilgrim Health Care's HMO business, and 3 percent for Harvard Pilgrim's non-HMO business, according to figures released by the Insurance Division.

Rates will increase 5.8 percent for customers of United Health Care, 0.6 percent for those of Health New England, and 1.8 percent for customers of Neighborhood Health Plan.

Premiums will decline 1.3 percent for Tufts Health Plan's HMO business and 2.2 percent for its non-HMO business. They will decrease 2.2 percent for Fallon Community Health Plan's HMO business and 2 percent for Fallon's non-HMO business.

Rates will fall 2.5 percent for Celticare and 0.2 percent for Connecticare.