Trends in Premiums in the Small Group and Individual Insurance Markets, 2008-2011. Relationship of Carrier Size, Product Type, and Market Concentration on Approval Rates

11/06/2012

We examined whether large carriers had higher approval rates than smaller carriers (Figures 15 and 16) using the same criteria for approval as in Figure 12. With the exception of the 2011 small group market, smaller carriers had significantly lower approval rates throughout the study period. 

Figure 15: Percentage of Premium Increases Approved, by Year, by Carrier Size - Individual/Conversion

Figure 15: Percentage of Premium Increases Approved, by Year, by Carrier Size - Individual/Conversion

† Data for 2011 are incomplete.
* Estimate is significantly different from Top 3 Carrier at p < .05.


Figure 16: Percentage of Premium Increases Approved, by Year, by Carrier Size - Small Group

Figure 16: Percentage of Premium Increases Approved, by Year, by Carrier Size - Small Group

† Data for 2011 are incomplete.
* Estimate is significantly different from Top 3 Carrier at p < .05.


We also analyzed observed differences in approval rates by product type (Figures 17 and 18). In the individual market, PPO and indemnity plans consistently had a higher approval rate than HMO plans. No pronounced pattern was apparent in the small group market. We note that HMO in 2009 had a significantly lower approval rate than PPO and indemnity, but a higher approval rate in 2010.

Figure 17: Percentage of Premium Increases Approved, by Year, by Product Type - Individual/Conversion

Figure 17: Percentage of Premium Increases Approved, by Year, by Product Type - Individual/Conversion

† Data for 2011 are incomplete.
* Estimate is significantly different from PPO/HDP at p < .05.


Figure 18: Percentage of Premium Increases Approved, by Year, by Product Type - Small Group

Figure 18: Percentage of Premium Increases Approved, by Year, by Product Type - Small Group

† Data for 2011 are incomplete.
* Estimate is significantly different from PPO/HDP at p < .05.


We additionally explored the association between market concentration and percentage rate requests approved (Figures 19 and 20). In the individual market, high concentration states had the highest rates of approval every year. These same high concentration states also had the lowest rates of increases each year (in Figure 10). Low concentration states had higher approval ratings than did medium concentration states in all but one year. High concentration states in the small group market had only a handful of observations over the study years, and are therefore omitted from the analysis. Low concentration states had higher approval rates all four years compared to medium concentration states.

Figure 19: Percentage of Premium Increases Approved, by Market Concentration, by Year - Individual/Conversion

Figure 19: Percentage of Premium Increases Approved, by Market Concentration, by Year - Individual/Conversion

† Data for 2011 are incomplete.
* Estimate is significantly different from Medium Market Concentration at p < .05. Note: Entries with fewer than five filings are not reported (N/R).


Figure 20: Percentage of Premium Increases Approved, by Market Concentration, by Year - Small Group

Figure 20: Percentage of Premium Increases Approved, by Market Concentration, by Year - Small Group

† Data for 2011 are incomplete.
* Estimate is significantly different from Medium Market Concentration at p < .05.
Note: Entries with fewer than five filings are not reported (N/R). No filings were available from states with high market concentration.

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