The Connecticut Insurance Department has released its actuarially justified rate determinations on health insurance companies’ rate requests for the 2018 coverage year.

Of the 14 filings made by 10 health insurers for plans that cover about 270,000 people, six of the requests were disapproved and reduced, five were approved as submitted, one was disapproved and increased, and two were disapproved and recalculated.

In June public hearings, Anthem and ConnectiCare Benefits Inc. were the two that were disapproved and re-worked. Those recalculations were based on the lack of federal funding for the cost sharing reduction (CSR) payments, which were applied to the “silver” on-exchange plans only and subsequently approved. The federal funding of the CSR payments for coverage year 2018 would have reduced the approved rate increases from 27.7 percent to 16.8 percent for CBI and from 31.7 percent to 24.7 percent for Anthem. In the end, Anthem was reduced by over 9 percent and CBI by nearly 1 percent.

“This has been a challenging year for all involved due to the uncertainty about federal funding for the CSR payments and individual market stability challenges. CSR payments are important financial relief for consumer out-of-pocket costs,” Insurance Commissioner Katharine L. Wade said in a statement.

The department has identified the following factors as the key cost drivers for the 2018 rates:

CSR payments: As a result of the lack of clarity about future funding of CSRs and the need to make rate determinations for 2018, the department asked exchange carriers to make a supplemental filing which assumed CSRs would not be paid. The supplemental rate increase for non-payment of the CSRs is 16.7 percent, this is applied only to the silver exchange plans. The increase in rates for the silver exchange plans will be mitigated for consumers receiving tax credits by the increase in the federal tax credits for 2018.

The annual trend of medical inflation: This relates to the cost of medical services, demand for and severity of services and increased prescription drug costs. This year, it has risen to an average rate increase of 10.5 percent.

Elimination of the moratorium on the health insurance tax: The elimination of the moratorium on the HIT increases premiums on average 3 percent.

Federal risk adjustment formula: Under the ACA, health insurers annually pay or receive funding depending on the assessed riskiness or health of their insured populations. There has been volatility in this program and concerns from state insurance regulators over the formula for who qualifies for payments or who is required to pay. The department has raised those concerns with the federal Center for Medicare and Medicaid Services and offered solutions to help achieve a workable, equitable formula and foster a more robust marketplace, on and off the exchange.