Premiums for the most popular plan on the Massachusetts Health Connector — the exchange designed to give consumers access to affordable insurance — will rise at least 15 percent next year, sticking members with hundreds of dollars in additional costs.
The jump, more than double the average increase for all Connector plans, would affect about 8,000 people who get unsubsidized insurance through the state-run marketplace. The plan is offered by Harvard Pilgrim Health Care, the state’s second-biggest commercial insurer.
Mark R. David, a 58-year-old consultant from Ipswich who uses the plan, said his monthly premiums will climb more than $150, or 19 percent, to $964 from $809. The plan also has a $2,000 deductible per individual, or $4,000 per family.
“I’m outraged,” David said. “How can they do this? It just feels like price-gouging.”
The rate hike would affect 17 percent of the roughly 46,000 people who buy insurance on the Connector and do not get government subsidies. They have the option of switching into another of the dozens of plans offered by Connector.
The Connector also offers insurance to more than 132,000 people who receive government subsidies to help defray the cost of coverage. Overall, premiums for Connector plans are rising 6.3 percent in 2016, said Jason Lefferts, an agency spokesman.
The Connector does not set rates. The Harvard Pilgrim plan is so popular in part because it is the only preferred provider organization, or PPO, available on the Connector this year, a Harvard Pilgrim spokeswoman said. A PPO plan does not require consumers to have their care coordinated through a primary care physician and gives them more choice than health maintenance organizations, or HMOs.
The Connector is offering 84 health plans for consumers in 2016, down from 126 plans this year.
“The Connector offers a wide range of plans ... at various rates and benefit levels,” Lefferts said.
Health care spending nationally and in Massachusetts, which had slowed in recent years, is accelerating again. In 2014, the annual growth in Massachusetts health spending doubled to 4.8 percent, according to state data.
State law sets a target of keeping health spending increases below 3.6 percent a year.
“This is a problem nationally. Rates are going up on exchanges all over the country,” said Barbara Anthony, the state’s former undersecretary of Consumer Affairs and Business Regulation. “It’s disappointing. While insurance market reform is a great thing and we want people to be covered, there’s a lot of work yet to do in terms of keeping these products affordable.”
Insurers have blamed rising drug prices and growing use of expensive medical services for increased costs, which are pass along to consumers in the form of higher premiums and co-pays.
Harvard Pilgrim said costs for its popular Connector plan rose faster than those for other plans because the insurer had to include in its budget risk adjustment payments, a mandate of the federal Affordable Care Act. These payments, which went into effect this year, distribute money from insurers with healthier members to those with sicker members.
Harvard Pilgrim spokeswoman Joan Fallon said the plan is still “very affordable and competitively priced” but added: “We have other offerings that members can consider. We encourage our customers to shop and consider all their op-tions.”Priyanka Dayal McCluskey can be reached at firstname.lastname@example.org. Follow her on Twitter @priyanka_dayal.