BlueCross BlueShield of Tennessee, Cigna, and Humana's individual insurance rates will soon sky rocket.
The state's biggest health insurer, BlueCross BlueShield, is raising rates by 62% next year. Cigna received state approval to raise rates by 46%, while Humana got the okay for a 44% jump in premiums for individual plans. Insurance carriers blame the Affordable Healthcare Act.
"We understand it's a very difficult position, there is no one who wants to deliver that news," says Spokesman Roy Vaughn, BlueCross BlueShield of Tennessee. "We don't want to look people in the eye and tell them we have to increase rates. The rates are meant to close the gab between what we've been charging in rates and what we're experiencing in medical claims."
Vaughn says the previously uninsured are more sick than anyone anticipated. Just 5% of the population now accounts for 73% of all medical claims.
"We are at a point where we've lost close to $500 million dollars over three years and that's unsustainable," says Vaughn.
The rate increase doesn't affect everyone, only individual policy holders who do not have government assistance.
"This impacts their wallets, impacts their personal lives, their family's lives and it's not something we want to do," says Vaughn.
You can shop for a cheaper plan with less coverage or opt out of health insurance coverage all together. But, opting out of Obamacare, could lead to a fine.
"They're still for less than what it costs for coverage so many young individuals have elected not to get coverage," says Vaughn.
The fine averages about $700 per adult or 2.5% of your household income (whichever is highest) with the maximum cost being around $2,000 dollars.
Still no coverage at all puts you at risk for financial ruin, should you need emergency care.
"At this point, this is not sustainable and massive changes are going to need to be made," says Senator Bob Corker.
You are exempt from paying a fine if the health care coverage is considered unaffordable and that happens if the lowest plan is more than 8% of your household income. You can also be considered exempt for certain life events and health coverage/ financial status.