Iowa Code §505.19 requires the Commissioner to hold a public hearing on a proposed individual health insurance rate increase which exceeds the average annual health spending growth rate as published by the Centers for Medicare and Medicaid Services of the United State Department of Health and Human Services. For 2025 the growth rate is 5.6%.
The Iowa Insurance Commissioner held a public hearing regarding the relevant rate increases on Aug. 8, 2024.
The purpose will be to hear public comments on the proposed increase in the base premium rate. Consumers wishing to make a public comment at the hearing are encouraged to attend the hearing via the live webcast.
All comments received will be considered public records and will be posted at https://iid.iowa.gov/health-insurance-rate-increase-data. The Consumer Advocacy Office will present the public comments received at the hearing.
No public hearing will be held for small group coverage, however, public comments will be accepted through the links below.
Rate Filing Observations:
With the newly revised proposal, the average premium increase is around $58 / month, i.e., $528 (2025 projected average premium) less $470 (current average premium). This is an average based upon all members, all age groups, all benefit plans, all geographic regions, etc.
Past loss ratios for this block have averaged just under 80% over the last 7-years.
Despite the rates for this plan increasing consistently over this time-period, the Federally prescribed minimum medical loss ratio of 80% has largely been achieved. During the review, it was observed that the loss ratios from 2023 to 2024 spiked significantly. The 2023 loss ratio was a lower than normal, however, the 2024 loss ratio through the 1st 5-months spiked to nearly 104%. This means that for every dollar the carrier received in premium, they have paid out $1.04 in claim payments.
In the absence of a rate increase for calendar year 2025, the IID’s projected loss ratio is approximately 91%.
With the modified rate increase, the current loss ratios and the continuing growth of claims, the Division’s projected Federal medical loss ratio is approximately 83% after the 12.3% rate increase is applied. Furthermore, Magnum Actuarial Group’s projected Federal medical loss ratio (after the 12.3% rate increase) meets or exceeds the 80% minimum. Both review teams have concluded that the rate increase will continue to generate the 80% Federally mandated medical loss ratio.
In the event the MLR dips below 80% with the revised rates (over a 3-year rolling basis), affected Iowans could receive a rebate under Federal law.
The Commissioner will review this rate increase proposal after considering public input from the hearing, along with the internal team’s recommendation and the consultant’s final report.
Rate Filing Observations:
The average premium increase is around $31/ month, i.e., $407 (2025 projected average premium) less $376 (current average premium). This is an average based upon all members, all age groups, all benefit plans, all geographic regions, etc.
Past loss ratios for this block have averaged nearly 93% over the last 7-years.
In the absence of a rate increase for calendar year 2025, the IID’s projected loss ratio is nearly 100%.
With the proposed rate increase, current loss ratios and the continuing growth of claims, the Division’s projected Federal medical loss ratio is approximately 95% after the 8.3% increase is applied. Furthermore, Magnum Actuarial Group’s projected Federal medical loss ratio is over 100% after the 8.3% rate increase is implemented. Both review teams have concluded that the rate increase will continue to generate the 80% Federally mandated medical loss ratio.
In the event the MLR dips below 80% with the revised rates (over a 3-year rolling basis), affected Iowans could receive a rebate under Federal law.
The Commissioner will review this rate increase proposal after considering public input from the hearing, along with the internal team’s recommendation and the consultant’s final report.
Rate Filing Observations:
The average premium increase is around $43/ month, i.e., $656 (2025 projected average premium) less $613 (current average premium). This is an average based upon all members, all age groups, all benefit plans, all geographic regions, etc.
Past loss ratios for this block have averaged just over 86% over the last 7-years.
In the absence of a rate increase for calendar year 2025, the IID’s projected loss ratio is over 102%.
With the proposed rate increase, current loss ratios, and the continuing growth of claims, the Division’s projected Federal medical loss ratio is approximately 99% after the 7% increase is applied. Furthermore, Magnum Actuarial Group’s projected Federal medical loss ratio is over 100% after the 7% rate increase is implemented Both review teams have concluded that the rate increase will continue to generate the 80% Federally mandated medical loss ratio.
In the event the MLR dips below 80% with the revised rates (over a 3-year rolling basis), affected Iowans could receive a rebate under Federal law.
The Commissioner will review this rate increase proposal after considering public input from the hearing, along with the internal team’s recommendation and the consultant’s final report.