EXCLUSIVE: Highmark prepares new renewal plan health insurance

Health insurer Highmark Inc. will offer employers new renewal plans for the critical July and December enrollment periods, four months after UPMC Health Plan introduced similar coverage.

At a meeting of insurance brokers Tuesday, Highmark officials provided broad outlines of renewal plans, called grandmothered plans, that do not comply with the Affordable Care Act, two people who were familiar with the presentation said. Pennsylvania is among nine states that have allowed a three-year extension of existing health insurance coverage, meaning employers may be able to keep their plans through 2017.

Highmark officials declined to comment Tuesday, but an announcement of the new product offerings was expected Thursday.

Employers are likely to be big winners of the new plans: brokers said UPMC's renewal rates for April through June came with rate hikes from the single digits to 48 percent, compared to 100 percent and higher increases for the more robust coverage mandated by the Affordable Care Act. Lower rates are also expected for Highmark's non-compliant products when compared with ACA plans, which could boost sales of the company's limited network Community Blue plans.

One key difference between the new Highmark and UPMC non-compliant renewal products: Highmark's offerings will allow greater flexibility in plan choice than UPMC, according to people familiar with the presentation.

Sheryl Kashuba, vice president, health/policy government relations and chief legal officer at UPMC Health Plan, previously declined to comment on renewal rates, saying premiums vary by insured group. UPMC Health Plan was the first in western Pennsylvania to introduce lower cost renewal plans for health insurance.

Kris Mamula covers health care, insurance and employee benefits for the Pittsburgh Business Times. Contact him at kmamula@bizjournals.com or 412-208-3825.