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Patrick Springer, Published August 08 2010

BCBS seeks premium increase

Medical inflation, after calming down somewhat last year, is stirring once again in North Dakota at a yearly rate of 8.8 percent.

That figure, compiled by Blue Cross Blue Shield of North Dakota, is up from last year’s relatively moderate increase of 5.5 percent but lower than the 9.8 percent increase in 2008.

“Our trend is ticking up a little bit,” said Denise Kolpack, vice president of corporate communications for the North Dakota Blues. “The bottom line is we’re still seeing members use more and better services.”

The health insurer, which covers more than 90 percent of the state’s private insurance market, is ramping up its cost-containment initiatives in collaboration with medical providers and customers.

Last week, Blue Cross Blue Shield of North Dakota submitted premium rate increase requests, but the information is confidential until Insurance Commissioner Adam Hamm decides if it’s fair.

The rate requests will receive “close scrutiny,” Hamm said, with a decision within 60 days. He said it was too early to tell whether last year’s dip in medical inflation was a “blip on the screen.”

Last year, the Blues sought an increase of 11.4 percent for group health insurance rates and received a premium increase of 7.9 percent. It now is submitting quarterly, instead of annual, premium increases for groups.

For individuals, a 12.2 percent rate increase took effect May 1; the Blues had sought a 13.1 percent increase, which it said translated into a 4.6 percent annual rate of increase since its last premium increase, 9.4 percent in 2007.

“Everyone is recognizing that it’s unsustainable,” Kolpack said of medical inflation rates far surpassing the general rate of inflation.

Trends include technological advances, which help to make earlier diagnoses, and increasingly sophisticated management of costly chronic diseases, such as diabetes, Kolpack said.

Over time, the cumulative effect of various cost containment programs should be reflected in lower rates of medical inflation.

“We hope to see an impact on the trend,” Kolpack said.

Additional medical management programs are on a “fast track,” with some new initiatives starting next year, she added.

Current figures for medical inflation in Minnesota were not readily available. A response to a request for rates in recent years that The Forum submitted to Blue Cross Blue Shield of Minnesota was not available as of this weekend, a spokeswoman said.

Similarly, the Minnesota Department of Commerce, which regulates health insurance, did not have figures readily available.


Readers can reach Forum reporter Patrick Springer at (701) 241-5522