$21.5 Million in Health Insurance Rebates for Individuals and Small Businesses

Thousands of Highmark 2019 plan participants and groups to receive checks

After announcing a reduction of Delaware Health Insurance Marketplace rates for the upcoming enrollment year, Insurance Commissioner Trinidad Navarro has more good news for residents who purchase insurance on the Delaware Health Insurance Marketplace, those who purchase Highmark Blue Cross Blue Shield Delaware plans outside of the exchange in the individual market, and for Highmark small group policyholders, announcing more than $21.5 million in rebates for 2019 participants.

“Now, more than ever, we need to make sure that every resident and small business can afford the health insurance they need for their families and employees. These rebates, combined with the ACA health insurance rate reduction for the coming year, do just that,” said Commissioner Navarro. “This is just one of many ways we are working to reduce the cost-of-care our residents experience in the health care system.

For the first time in the history of Delaware’s individual health insurance market, more than $12.6 million will be returned to 19,273 policyholders, with the average rebate being $656. Highmark small groups, often small businesses, will receive more than $8.8 million in cumulative return. 2,779 groups will receive an average rebate of $3,198, with more than 175 groups receiving rebates over $10,000. Employers can consider using these dollars to enhance benefits, reduce premiums for employees in future policy years or provide refunds directly to group health plan participants.

Communications will be sent to policyholders in September and checks for both individual policyholders and small groups will be sent the week of September 21. Those in the individual market with rebate questions can contact Highmark at 800-544-6679. Small group employers with rebate questions can contact their insurance producer, or Highmark at 800-241-5704.

These rebates are required by the Delaware Department of Insurance according to Medical Loss Ratio (MLR) measurements set by the Affordable Care Act, which are meant to ensure that insurers are spending a majority of premiums on health claims and clinical services, not taking those dollars for profit or administrative expenses. The rebate system creates balance when data shows that this ratio was off in a previous year. Not every policy will receive a rebate. MLR review for the 2020 plan year will shine a light on changes in insurance usage due to COVID-19 and will be released in 2021.

On August 31, Commissioner Navarro announced the Delaware Health Insurance Marketplace would see an average decrease in rates of 1% for individual plans. Highmark small group plans will see an average premium decrease of 3%.


Rates To Decrease In Delaware Affordable Care Act Marketplace

Second consecutive year of reductions in health insurance rates

In a year when the nation’s attention is firmly focused on healthcare and its costs, Delaware Insurance Commissioner Trinidad Navarro has announced another reduction in rates on the Delaware Health Insurance Marketplace. Despite insurer costs related to COVID-19 testing and treatment, Commissioner Navarro negotiated an average decrease of 1% in health insurance rates. Highmark Blue Cross Blue Shield Delaware, who offers the state’s Affordable Care Act health plans, initially submitted a reduction of 0.5%. The Commissioner’s final rate announcement comes after an independent actuarial review and public comments on the insurer’s proposal.

“I am proud to announce today the second consecutive rate decrease for Delaware’s Affordable Care Act plans. Amid a global pandemic, it is more important than ever for residents to have access to affordable insurance. Given the difficult economic climate, more people are relying on the Marketplace for the coverage they need,” said Commissioner Navarro. “With this decrease, we send a strong message about the effectiveness of the ACA during its 10th anniversary year. We will continue to fight to ensure access to affordable coverage for all Delawareans.”

In 2019, after successfully applying for a 1332 reinsurance waiver, the state was able to negotiate an average rate decrease of 19% for 2020 plans. This year’s modest reduction reflects market stabilization following the implementation of reinsurance.

After the rate reductions for the 2020 plan year, enrollment spiked by 6.3% during the traditional enrollment period. As of the start of the year, nearly 24,000 Delaware residents participated in marketplace-offered plans. While the federal government has not opened enrollment in response to COVID-19, residents losing employer-sponsored health coverage due to the economic impacts of the pandemic may qualify for special enrollment outside of the traditional enrollment period.

Open enrollment for the Marketplace takes place between November 1 and December 15 each year. However, residents may qualify to enroll or change plans based on special circumstances, such as a loss of qualifying health coverage, change of income, becoming a parent, and several other qualifying factors. Find out if you qualify for special enrollment.

The news of the second consecutive rate decrease comes as the department is implementing other consumer cost-of-care protection efforts, including regulating Pharmacy Benefit Managers to control and reduce medication cost, and continuing efforts to create an Office of Value-Based Healthcare Delivery to focus on primary care affordability and availability.

The proposed rate decrease does not apply to Medicare, Medicaid, or those with group or individual policies outside of the Marketplace.

More information on the rate review process


Regulations That Can Increase Affordability Of Medications Announced

New regulations increase oversight of Pharmacy Benefit Managers

Excessive pharmaceutical costs are a concerning trend occurring across the nation, and today the Delaware Department of Insurance has finalized new regulations for Pharmacy Benefit Managers (PBMs) to proactively combat the issue. The regulations go into effect on August 11 as part of implementing HB 194, and come after extensive stakeholder discussions.

PBMs administer prescription drug plans for health insurers, large employers, Medicare Part D plans, and other groups, determining the list of medications that a plan will cover and the consumer costs of those drugs. These companies hold massive negotiating power and receive billions of dollars in rebates from manufacturers, but to date have widely not used their power to reduce the costs of medications and insurance. The new regulations from the Department of Insurance will begin an increasing level of oversight and transparency, allowing the department to investigate companies, require corrective actions, and to suspend, deny, or revoke a PBM’s registration if they are acting in violation of the Code.

“Increasing the affordability of prescriptions and healthcare increases their accessibility, creating a healthier Delaware. These steps towards regulating this multi-billion-dollar industry will save residents money, and could save residents lives,” said Insurance Commissioner Trinidad Navarro. “I want to commend Pharmacy Reimbursement Task Force co-chairs Sen. Sokola and Rep. Bennett, as well as Chair of the former Interagency Pharmaceuticals Purchasing Study Group Rep. Seigfried, for their passion and hard work towards these regulations and their inclusion of a diverse array of stakeholders throughout the process. Our work on this issue is just beginning, and we are grateful for your partnership.”

The Pharmacy Reimbursement Task Force and the former Interagency Pharmaceuticals Purchasing Study Group each demonstrated the General Assembly’s focus on lowering the cost of care, working on a range of issues surrounding protecting Delawareans from excessive medication costs, negotiating and lowering drug prices, and creating price transparency and corporate accountability.

“One of the most important things we can do as elected officials is work to keep prescription drugs affordable and accessible, particularly for our most vulnerable residents,” said Sen. David Sokola, D-Newark. “I’m proud of our work on the Pharmacy Reimbursement Task Force and proud to have helped develop regulations that will increase transparency around a little-known sector of our health care industry. These regulations from Commissioner Navarro and his team at the Department of Insurance represent a solid beginning to the work I look forward to continuing in 2021.”

The department and the General Assembly plan to work together to advance legislation regarding PBMs in the future. A related bill was proposed during this year’s session, but it did not advance due to the compressed legislative timeline during COVID-19.

“High prescription drug costs can debilitate a person’s finances, hindering how they save and plan for daily and long-term expenses. We owe it to consumers to fight for their best interests, increasing access and affordability to needed medications,” said Rep. Andria Bennett, who sponsored HB 194 to regulate PBMs. “Pharmacy benefit managers should put the consumer first, not profit. That’s why we fought to increase transparency and oversight: so Delawareans are not taken advantage of in such a vulnerable way. Commissioner Navarro’s regulation will provide even more transparency and comfort to our residents, and I thank him for his commitment to them.”

“Pharmacy Benefit Managers are companies that have, through the years, gained significant control over the supply, demand, and cost of pharmaceuticals – around 80% of the market – with little to no regulation at all. They are, in essence, governing both the cost and flow of medicines between people in need of medication and the manufacturer, health insurance company, community pharmacies, and the company providing medication benefits. This has led to higher costs for residents who don’t really have a choice in whether to pay for lifesaving medication,” said Rep. Ray Seigfried, a former Christiana Care senior vice president.

“My colleagues and I pushed HB 194 to require registration of all PBMs doing business in Delaware as a first step to reining in these managers. Commissioner Navarro’s regulations create standards such as having access to books and records of their operation, contract templates, and staffing. It provides the right to denial, suspension, or revocation. This order will provide the first step to begin opening the door to greater transparency. I thank Commissioner Navarro and his team for taking these important steps forward.”

Registration of Pharmacy Benefits Managers Regulation


Important Insurance Reminders After Tropical Storm Isaias

Commissioner Navarro encourages caution in repairs, meets with community

Tropical Storm Isaias produced tornado activity, heavy rain and flooding, hail, and strong winds throughout the state, causing significant destruction in several Delaware communities. Insurance Commissioner Trinidad Navarro visited residents and assessed damage on Wednesday.

“While measuring the full extent of this storm will take time, we know one thing – we must come together as a community and support those that need to rebuild,” said Commissioner Navarro after touring Amberwood community in Bear, which saw extensive storm impacts, and speaking with those beginning the insurance claims process. “I understand the eagerness of every resident to clean up and make repairs, but I can’t emphasize enough the importance of contacting your insurance company first. Take photos of everything and do not make permanent repairs before working with your insurance adjuster. Make only necessary, temporary repairs to prevent additional damage. Save all documentation, pictures, and receipts.”

Insurance Commissioner Trinidad Navarro talks with a resident next to a down tree.

The Delaware Department of Insurance Consumer Services Division is working with residents who have questions or concerns about their insurance company’s actions, and can be reached at (800) 282-8611 or (302) 674-6227, or by email at consumer@delaware.gov.

Underscoring the importance of proceeding through the insurance claim and property repair process with caution, Commissioner Navarro highlighted the frequency of fraudulent activity after a storm: “Anytime we experience a big storm like Isaias, we see storm-chasing scammers pop up in neighborhoods, falsely stating they are with an insurance company, or encouraging homeowners to sign on to repair contracts without going through the proper channels – often price gouging residents, or completing shoddy repairs if they make any at all, leaving the consumer on the hook for costs that could have been covered by an insurer.”

Residents who encounter a storm-related insurance scam can contact the Fraud Prevention Bureau at (800) 632-5154 or (302) 674-7350, or email fraud@delaware.gov. Consumers are urged to carefully review contracts for home repairs, ask for references and research companies through the Better Business Bureau.

Consumers may contact the Delaware Emergency Management Agency, DEMA, to see what assistance may be available as a result of the Governor’s State of Emergency. Property insurance policyholders should be aware of the dwelling deductible stated on their insurance declaration page, and take note that there may be a deductible for named storms, wind, hail, or tornadoes that may apply to the claim, most often stated as a percentage of dwelling coverage.

Due to COVID-19 precautions, Department of Insurance offices are not currently open to the public, but residents are encouraged to contact the department at one of the emails or phone numbers above, or call (302) 674-7300 for assistance.

Insurance Commissioner Trinidad Navarro speaking to a resident whose deck was damaged by the storm.Insurance Commissioner Trinidad Navarro speaking to residents.


Navarro Urges Residents to Prepare for Tropical Storm Isaias

Provides information on insurance processes for property damage

As Tropical Storm Isaias approaches Delaware, residents are urged to prepare for dangerous winds over 55 miles per hour and up to 6 inches of rain. Storm surges, localized flooding, tree damage, power outages, and other threats to life and property are possible, according to the National Weather Service (NWS). Rain is expected Monday evening, with the brunt of the storm arriving early on Tuesday.

“As models continue to show Delaware in the path of this storm, home and business owners should take steps to reduce property damage and stay safe,” said Insurance Commissioner Trinidad Navarro. “Secure any outdoor items or furniture that could cause damage when windy conditions occur, charge your cellphones, gather emergency supplies, and make a plan about where you can take shelter away from windows at the peak of the storm. Keep in mind that roads may become difficult to navigate due to debris and tree damage, and never drive through a flooded area.”

Isaias is expected to hit Delaware Tuesday morning. Potential storm impacts include damage to porches, carports and other awnings, as well as roofing and siding, with impacts on mobile homes more significant. NWS expects uprooted or snapped trees in addition to flooding, causing impassable roadways and power outages in some places. Storm surges are likely, and tornadoes are possible.

In advance of storms, residents are urged to locate important documents, including homeowners and auto insurance policies and company contact information, as well as a complete a home inventory. If your property is damaged by Tropical Storm Isaias, contact your insurer before you clean up or make repairs, and photograph all damage. After speaking with your insurer and photographing damage, take action to prevent further damage by covering broken windows, damaged walls, or leaking roofs, but do not make permanent repairs. Your insurance company should inspect the property and estimate the cost of permanent repairs. Save all receipts and documentation, including those related to temporary repairs.

Hurricane season lasts well into the fall, and residents should make plans and take precautions now to reduce future risks, including exploring flood insurance. More than 20 percent of flood insurance claims are for properties outside of high-risk areas. Flood insurance policies typically take 30 days to go into effect. For more information about FEMA’s flood insurance program and to find an agent in your area, visit FloodSmart.gov or call 1-800-427-4661.

For more information on how to prepare your home for inclement weather, visit the Department of Insurance Disaster Preparedness page.