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Maine.gov > PFR Home > Insurance Regulation >Small Group Health Insurance Renewals by Geographic Area

Small Group Health Insurance Renewals by Geographic Area
Executive Summary
September 2012

The following charts reflect the range of increases in health insurance premiums received by small employers by geographic area for 4th quarter 2010 through 3rd quarter 2011 renewals compared to 4th quarter 2011 through 3rd quarter 2012 renewals from data provided by the carriers.  This information is intended to illustrate the immediate impact of PL 90 on small group health premiums.  PL 90 allows geographic rate adjustments to be made without the previous limit on the combined adjustments for age and area beginning with the October 2011 renewals.  Although this analysis focuses on geographic area, PL 90 also expanded the allowable rating variations for age.  

Rate increases also vary significantly among different groups for reasons unrelated to PL 90.  Employers whose circumstances change may see larger increases because of factors other than those associated with their geographic area.  For instance, if a business downsizes, a larger group size adjustment may apply.  A decrease from three to two employees can increase rates by 25% to 39% in addition to the “normal” increase.  If a younger employee is replaced by an older one or if one or more employees age into a higher age band, the age factor will cause an increase*.  Two or more of these events can combine to result in significant rate increases.   Average base rate increases each quarter also vary for each carrier depending on the experience of the business and expected trends. We have attempted to gauge the impact of PL 90 by comparing the increases this year to those in the prior year. 

The charts do show some geographic differences in rate renewal increases received by small groups.  There have been rate decreases in the past, but for the 12 months after implementing PL 90 11.4% of renewals reflect decreases compared to 3.5% before PL 90.  Also, while the distribution of increases and decreases in past years show no little variation by geographic area, this year, the proportion of small employers receiving rate decreases was higher in the southern part of the state (Cumberland and York) and the proportion receiving increases larger than 40% was higher in the northern part of the state (Aroostook, Penobscot, and Piscataquis) and in the eastern part of the state (Knox, Lincoln, Waldo, Hancock, and Washington).

*Effective for renewals beginning October 1, 2012 PL 638 requires rate factors due to age and group size combined to be limited to 2.5:1.

Pre-PL90 Percentage of Small Group By Geographic Area

Counts by geographic area:
Size of rate increase: < 0% (rate decrease) 0-20% 20-40% 40-60% 60-80% 80-100% > 100% Total
Central
44
818
505
68
23
11
4
1473
East
48
740
478
68
20
9
9
1372
North
40
514
416
46
12
4
5
1037
South
160
2677
1216
204
72
20
14
4363
West
17
336
132
26
8
5
0
524

Area Key:

Central
Androscoggin, Kennebec, Sagadahoc

East
Knox, Hancock, Lincoln, Waldo, Washington

North
Aroostook, Penobscot, Piscataquis

South
Cumberland, York

West
Franklin, Oxford, Somerset


Post PL90 small group renewals by geographic area

Counts by geographic area:
Size of rate increase: < 0% (rate decrease) 0-20% 20-40% 40-60% 60-80% 80-100% > 100% Total
Central
96
818
433
58
25
11
6
1477
East
57
534
451
167
68
20
12
1309
North
35
407
335
169
36
14
8
1004
South
760
2692
661
114
37
17
5
4286
West
25
268
139
52
11
4
0
499

Area Key:

Central
Androscoggin, Kennebec, Sagadahoc

East
Knox, Hancock, Lincoln, Waldo, Washington

North
Aroostook, Penobscot, Piscataquis

South
Cumberland, York

West
Franklin, Oxford, Somerset

  • The South and Central regions saw the greatest percentages of rate decreases (17.7% and 6.6%, respectively) and 0-20% increases (62.8% and 56.5%).
  • The North, East and West regions had the greatest percentages in the 20-60% rate change band (50.2%, 47.3% and 38.3% respectively).
  • The East and North regions had the greatest percentages in the 60%-100% rate change band (7.6% and 5.8% respectively).

Pre and Post PL90 combined

Size of rate increase: < 0% (rate decrease) 0-20% 20-40% 40-60% 60-80% 80-100% > 100% Total
Pre PL 90
309
5085
2747
412
135
49
32
8769
Post PL 90
973
4719
2019
560
177
66
31
8545
  • There were more rate decreases post-PL 90 (11.4%) than pre-PL 90 (3.5%).
  • There were slightly more increases in the 40%-60% and 60%-80% bands post-PL 90 than pre-PL 90 (6.6% vs. 4.7% and 2.1% vs. 1.5% respectively).
  • Increases greater than 80% were fairly similar during the two comparison periods.

 

 

Last Updated: September 24, 2012