Rhode Island Health Insurers Seek Highest Rate Increases in Over a Decade

Health insurers are asking Rhode Islanders to pay the steepest premium increases in over a decade for their coverage next year, state insurance officials announced Friday as part of an annual rate review process.

The Office of the Health Insurance Commissioner (OHIC) released insurers’ recently filed proposals for 2026 premiums, with proposed rate hikes ranging from 21.2% to 28.9% for some individual plans — or nearly quadruple the average 7.8% increase approved last year. Employer-sponsored coverage saw rate proposals ranging from 13.5% to 26.4%, depending on the type of plan.

Cory King, the state’s health insurance commissioner, and his office will decide whether to approve, reject, or modify each rate request, with final decisions anticipated in September. But they won’t have input from the Rhode Island Office of Attorney General.

For the past three years, the attorney general’s office has hired actuaries to review the rate filings and submit recommendations to OHIC. But a spokesperson for Attorney General Peter Neronha said no such review will be conducted this year. It’s a notable departure from past practice given Neronha’s recent emphasis on rate reform to address the state’s damaged health care infrastructure.

Tim Rondeau, a spokesperson for the Neronha, offered a comment via text message Monday.

“The Attorney General’s Office will advocate on behalf of consumers during the administrative hearing on individual market rates, consistent with our statutory obligations,” Rondeau wrote. “Beyond that, based on years of experience participating in this process, we have opted to forego actuarial analyses, which we believe provide very little benefit to consumers. Instead, we’ll redirect these resources towards health care initiatives where we can make tangible impacts.”

In a statement Friday, King acknowledged the “significant additional costs” health insurers are asking working Rhode Islanders to bear.

“These costs represent a significant financial burden and OHIC will scrutinize the insurers’ requests as part of our review to determine whether they are justified,” King said.

As part of the review process, Rhode Islanders can weigh in during a series of public hearings. The two insurers with the largest requested increases for individual coverage — Blue Cross Blue Shield of Rhode Island (BCBSRI), and Neighborhood Health Plan of Rhode Island — will be subject to separate hearings when the public can provide feedback.

The first hearing on BCBSRI’s proposed increases takes place June 30 and July 1 with Neighborhood Heath Plan’s hearings scheduled for July 15 and 16. A virtual town hall on July 24 will cover all requested rate increases. The two insurers with the largest requested increases for individual coverage — Blue Cross Blue Shield of Rhode Island (BCBSRI), and Neighborhood Health Plan of Rhode Island — will be subject to separate hearings which will allow the public to provide feedback.

Premiums vary depending on how people get their health insurance. Work-sponsored coverage is further split into two groups according to employer size. This year’s proposed rates across the three different markets include:

• Individual market, for people who purchase their own private insurance: Blue Cross Blue Shield of Rhode Island asked for a 28.9% increase, and Neighborhood Health Plan of Rhode Island filed a request for a 21.2% increase. Individual plans are held by 54,339 Rhode Islanders, according to March 2025 data from OHIC.
  
• Small group market, for smaller businesses which purchase employee coverage: Blue Cross asked for 22.2%, Neighborhood submitted 20.3%, and UnitedHealthcare submitted a range of 20.3%-21.2%. Small group plans account for 42,865 people.
  
• Large group market, for plans purchased by large businesses, such those with more than 100 employees. Blue Cross, UnitedHealthcare, Harvard Pilgrim, Aetna, and Cigna requested hikes from 13.5% to 26.4%, averaging 24.1%. A total of 77,654 consumers get coverage through large group plans

OHIC only reviews rates for fully-insured plans, or those in which the insurer assumes financial risk for medical costs. That means the office does not inspect rates for the approximately 65% of Rhode Islanders with self-funded insurance — employer-sponsored plans in which the business, not the insurer, pays workers’ health care claims directly. These plans often contract with insurers for administrative services like claims processing and provider networks, but OHIC does not regulate these premiums. States have limited oversight over self-funded plans because of federal regulations.

OHIC relayed that insurers cited a multitude of cost factors in this year’s sometimes outsized rate requests, such as larger payments to hospitals and providers, increased use of and claims for GLP-1 drugs like Wegovy for weight loss, and tariffs and other economic pressures at the national and global levels. OHIC noted insurers are also looking to build up their reserve margins, or the money companies use to cushion finances so they can pay future claims.

Blue Cross Blue Shield of Rhode Island spokesperson Richard Salit recounted several of these contributing factors in an email Friday, noting that the company already cut 3% of its workforce in March to accommodate rising costs.

“The requested rates reflect a growing number of complex factors that are making healthcare even more unaffordable for Rhode Islanders,” Salit wrote. “Among the most significant: BCBSRI has experienced an increase in healthcare spending of about 20% over the past two years due to Rhode Islanders receiving more services and costs rising, including for more expensive drugs.”

“These costs have grown faster than premiums and contributed to BCBSRI posting an unprecedented net loss of $115 million for 2024, while reserves necessary to ensure the ability to pay claims during financially challenging times have diminished,” Salit continued.

The proposed 2026 rates also reflect Blue Cross adapting to a recent OHIC requirement that insurers raise payments to primary care providers by 30% by January 2026 — a mandate which drove more than one-fifth of the requested increase for plans. Additional pricing pressure comes from federal enhanced premium tax credits due to expire in 2026 without further action from the U.S. Congress. These would affect about 30,000 Rhode Islanders and comprise about a third of the requested rate increase, Salit said.

Salit supplied two charts that break down the cost drivers behind BCBSRI’s proposed increases. In the individual market, the biggest contributors include a 10.2% rise in health care costs, the 9.7% impact of the expiring tax credits, and a 5.1% increase tied to new primary care payment mandates.

For large group plans, major factors include an 8.3% rise in medical costs, a 6.7% shortfall from 2025 premiums, and a 5% bump from the new rule regarding heftier primary care payments.

Similar sentiments were shared by Philip Tracey, a spokesperson for Harvard Pilgrim, in an email Friday: “Affordability challenges persist for consumers and employers. Medical and pharmaceutical costs continue to climb to unprecedented levels — higher than they have risen in decades. The rates filed for our product are a direct reflection of these unabating costs.”

Neighborhood Health Plan’s Elizabeth McClaine, the company’s vice president of commercial products, said via email Friday that the insurer is “participating in the comprehensive review process underway by the Office of the Health Insurance Commissioner (OHIC) as they assess rates for consumer affordability, and provider and insurer financial stability.”

Researchers and think tanks have also cited hospital costs as one accelerant fueling health care costs. A 2024 analysis by the RAND Corporation study of more than 4,000 hospitals found that private health insurers pay hospitals on average 254% what Medicare pays for the same services, with some states’ private insurers exceeding 300% of Medicare rates.

According to the report’s summary: “Very little variation in prices is explained by each hospital’s share of patients covered by Medicare or Medicaid; a larger portion of price variation is explained by hospital market power.”

This story was originally published by the Rhode Island Current.