“This is great progress,’’ Governor Deval Patrick said. “We went from 16, 17, and 18 percent increases a couple of years ago to 2.3 percent. It’s great for small businesses and the Massachusetts economy. But we need to make sure it’s sustainable.’’
Patrick has spent the past two years pressing Massachusetts health insurers, as well as hospitals and doctors, to restrain rising health care spending. He argued that annual double-digit percentage rate increases over most of the past decade were crippling businesses and individuals, and making it harder for employers to create jobs.
Among other moves, the state Division of Insurance temporarily froze 2010 rates at 2009 levels after insurers that year requested average premium increases of 16.3 percent. While the health insurance companies initially protested, contending they would lose money, most eventually agreed to limit 2010 increases to about 10 percent.
Since then, insurers have been cutting administrative costs while also taking a harder line in contract negotiations with health care providers. Hospitals and doctors, for their part, have been working to deliver care more efficiently and fend off the possibility that the state might move to regulate how much they receive from insurers.
“The governor has helped us to focus on this issue,’’ said James Roosevelt Jr., chief executive of Tufts Health Plan, which filed for the smallest premium increase among the state’s major commercial health insurance companies. “But then the insurers and the providers were able to negotiate better coordination of care. We’re working hard to continue this trend.’’
The new small-group rates mirror a moderation in the reimbursement increases insurers are giving Massachusetts health care providers, and could predict upcoming health insurance rate-setting for large companies and other markets.
