Report Finds $2.2 Million in Premium Relief Warranted at this Time
Montpelier, VT (July 20, 2021) — Today the Vermont Department of Financial Regulation (DFR) released a report examining the financial impacts of COVID-19 on Vermont’s commercial health insurance marketplace to determine whether any consumer premium relief is warranted.
The report focuses on the financial performance of BlueCross BlueShield of Vermont (BCBSVT), MVP Health Group (MVP), the Vermont Education Health Initiative (VEHI), and Cigna throughout the pandemic.
The report found COVID-19 mitigation measures, such as the postponement of non-essential medical and surgical procedures, resulted in excess profits for health insurers in 2020, however, as pandemic conditions improved, much of the deferred medical care returned resulting in potential losses in 2021.
The report found that only two market segments had COVID-19 related profits when reviewing 2020 and 2021 together at this time. Specifically, BCBSVT’s Medicare Supplement and Cigna’s large group market segments, which together totaled approximately $2.2 million in COVID-19 related profits. However, the report also concludes that additional premium relief in these or other market segments may be warranted in the future.
“The pandemic caused severe disruption to our daily lives including preventing Vermonters from seeking non-essential medical care at times even though they continued to pay their health insurance premiums, “said DFR commissioner Michael Pieciak. “It was important to ensure Vermonters did not overpay for commercial health insurance during the pandemic, and we determined that in most instances they did not, and where they did, Vermonters would be receiving premium relief.”
Pandemic mitigation measures also had favorable financial impacts on providers of other lines of insurance. For example, DFR previously approved $24 million in premium relief for Vermont auto insurance policyholders due to significant reductions in driving during the pandemic and $3.2 million for dental insurance policyholders due to pandemic restrictions on routine dental care.
Regarding the health insurance premium relief, Cigna has already returned approximately $118,000 to its eligible large group policyholders and DFR will require BCBSVT to incorporate consumer relief totaling approximately $2.1 million in its upcoming 2022 Medicare Supplement filing.
DFR plans to review other 2022 Medicare Supplement filings and VEHI’s upcoming rate filing to determine if any additional COVID-19 related rate relief is appropriate.
DFR’s report did not analyze employers who provide health insurance through self-insurance as those plans fall under federal jurisdiction.
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