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The Honolulu Advertiser
Updated at 6:21 p.m., Tuesday, October 7, 2008

Kaiser Permanente seeks rate hike for most members

Advertiser Staff

Kaiser Permanente Hawaii, the state's largest health maintenance organization, wants to raise rates for the majority of its members by an average of 4.9 percent next year and has applied for approval from the state insurance commissioner.

The company said the hike would affect 167,000 of its about 225,000 members. The affected people work for 6,000 companies subscribing to Kaiser healthcare programs.

Spokeswoman Lynn Kenton said the company had tried to manage efficiently and cut costs so that it didn't have to pass on a big increase to members.

Even so, the rate hike would be the biggest in four years for Kaiser if it is approved by Insurance Commissioner J.P. Schmidt.

Schmidt said he hopes to have a decision on the rate increase by the end of November. Under state law his office can take 60 days to review rate increase requests but may take longer if it deems more information is needed.

This year Kaiser had a 2 percent increase. Previous premium hikes included a 3.75 percent increase in 2007, a 3 percent increase in 2006 and an 11 percent increase in 2005.

Kaiser said it also is seeking an average 6.1 percent rate increase for its individual plans that have about 20,000 members.

The rate proposals come as the Hawaii Medical Service Association looks at a round of increases for more than 100 large employers who have their rates adjusted each January.

So far Schmidt has approved rate hikes for 22 of the so-called merit-rated group companies, with the increases averaging 13 percent. Some increases have been higher and some lower. Schmidt said he expects HMSA, the state's largest health insurer, to file proposed rate increases for other companies in coming weeks.