Blue Cross Blue Shield of Michigan Holds the Line on Small Business Rates

Blue Cross Blue Shield of Michigan Holds the Line on Small Business Rates

DETROIT, Feb. 26, 2018 – Blue Cross Blue Shield of Michigan today announced an average downward rate adjustment for Blue Care Network small group customers, and a modest, statewide average rate increase for Blue Cross small group customers, renewing in the third and fourth quarters of 2018, pending state regulatory approval. Average rate adjustments for small group customers renewing in the second half of 2018 will be 0.2 percent lower for Blue Care Network customers and 2.5 percent higher for Blue Cross customers. This follows rate reductions Blue Cross delivered to small employer group customers that renewed during the second half of 2017.

Over the past three years, Blue Cross’ statewide small group rate trends have remained steady with minimal adjustments. After maintaining rates without an overall increase throughout 2015, Blue Cross customers saw a minimal 0.8 percent average increase in 2016, which then trended back down to a zero percent adjustment in 2017. In total, these positive trends have resulted in a less than one percent overall rate increase for Blue Cross’ small group customers over the last three years.

“We’re seeing more small businesses wanting to provide coverage to their employees, and we want to help them do that,” said Sandra Fester, vice president for Middle and Small Group Business at Blue Cross Blue Shield of Michigan. “Blue Cross has seen a nearly 10 percent increase in small business customers during the past year. This reflects the strength of our brand and the competitiveness of our pricing.”

More than 293,000 Blue Cross members receive health care coverage through small business employers, the most since 2014.

Health insurance rate moderation for small employers in Michigan is a result of Blue Cross’ emphasis on delivering more cost-efficient health practices to the market and successful collaboration between physicians and hospitals across the state to provide an enhanced quality of care for members.

These efforts include the company’s value-based reimbursement programs with providers and the nation’s largest Patient-Centered Medical Home initiative. The Medical Home has not only improved the quality of health care in the state, but also contained costs, saving $427 million in its first six years and reducing adult ER visits by 19 percent. Coupled with more than 25 other Value Partnerships programs designed to improve the quality of care, which have resulted in a more efficient, less costly health care system that has directly saved more than $1.4 billion in costs statewide, has enabled Blue Cross to manage rates at a level below the national average.

“For more than 10 years, we’ve worked hand in hand with doctors to help improve health care in Michigan,” said Fester.  “It’s great to see that work paying off for our customers.”

Health insurance rates are largely influenced by geographic location, followed by age, family size and tobacco use and some U.S. states are experiencing double digit small group rate increases.

Small businesses can help manage the costs associated with employer-provided health care through the promotion of wellness programs and helping employees better understand how to use the health care system by engaging in regular, preventative care and using cost transparency tools.

A graphic showing rate trends over time

Blue Cross Blue Shield of Michigan, a nonprofit mutual insurance company, is an independent licensee of the Blue Cross and Blue Shield Association. BCBSM provides and administers health benefits to more than 4.5 million members residing in Michigan in addition to employees of Michigan-headquartered companies who reside outside the state. For more company information, visit bcbsm.com and MiBluesPerspectives.com.