Obamacare splitting in two…


This Election Opens Final Act for ‘Obamacare’ Controversy

Increasingly, there are two ObamaCares.
There’s the one in coastal and northern areas, where the marketplaces include multiple insurers and plans. And there’s the one in southern and rural areas, where there is often little competition, a situation that can lead to higher premiums.
“There’s really two kind of stories that are playing out,” said Cynthia Cox, who studies insurer competition at the Kaiser Family Foundation.

The trend is likely to be accelerated by the departure of Aetna and UnitedHealthcare from ObamaCare marketplaces in 2017. The loss of those insurers won’t affect all parts of the country equally, experts say.

“The combined effect of these exits is mostly concentrated in southern states and particularly rural counties within those states,” Cox said.

According to an analysis from the consulting firm Avalere, as of now, there will be just one insurer offering ObamaCare coverage next year in seven states: Alabama, Oklahoma, South Carolina, Wyoming, Alaska, North Carolina and Kansas. It is possible that more insurers could enter these markets before next year.

In one county in Arizona, there might not be an ObamaCare plan available at all.
Aetna had been the only insurer offering a plan in Pinal County. Unless federal and state officials can find another insurer to fill the void in 2017, the county’s 400,000 residents will not be able to buy coverage on an ObamaCare exchange.

The dearth of options in rural, sparsely populated areas is a far cry from what Democrats promised when selling the Affordable Care Act.

Obama talked at the time about how the law would create a “one-stop shop” for insurance, comparing it to websites where people can look for airline tickets.
“Just visit healthcare.gov, and there you can compare insurance plans, side by side, the same way you’d shop for a plane ticket on Kayak or a TV on Amazon,” Obama said in 2013. “You enter some basic information, you’ll be presented with a list of quality, affordable plans that are available in your area, with clear descriptions of what each plan covers, and what it will cost.  You’ll find more choices, more competition, and in many cases, lower prices.” 

In states like Oklahoma, the reality is different, with just one insurer to choose from in the online marketplace.

“We certainly see this as an issue,” said Mike Rhoads, Oklahoma’s deputy insurance commissioner. “With only a single carrier out there, there is no competition.”
“I think competition drives price sensitivity by these carriers,” Rhoads said.

Adding to the geographic disparities under ObamaCare, many of the same states where insurance competition is lacking declined the health law’s expansion of Medicaid. Because of that, many lower-income people have no insurance option at all.

Still, many rural areas had few insurance options before ObamaCare came along. Back then, individual plans were pricey and difficult to find, and insurers could reject people with preexisting conditions.

Under ObamaCare, insurers cannot deny coverage for health conditions, and lower-income people receive financial assistance to offset the cost of premiums.

Cox, the Kaiser Family Foundation expert, said the main consequences of insurers leaving ObamaCare next year will be enrollees having to switch plans. The cost to the federal government of providing ObamaCare, meanwhile, could rise if premiums increase.

In Oklahoma, Rhoads said he has been trying to recruit more insurers to join the ObamaCare marketplace, but found no takers.

“We see no other carriers willing to come in,” he said. “We certainly have had conversations with some of the national players.”

Rhoads said he spoke with two insurers that participated in ObamaCare’s first year about returning. They declined, citing the financial losses they suffered before.

“There’s a little bit of giggling in the background when we ask this question, and we understand that they’ve been there, they’ve done that, they’ve taken their lumps,” Rhoads said.

“As we discussed with one of the CEOs of a large HMO, who had competitive rates, they had their losses and their board of directors was just incensed that they hadn’t made money, and it caused some turmoil within the organization,” he added.

Relying on just one insurer to offer coverage runs the risk of having ObamaCare disappear, should that insurer bail from the marketplace.

In areas with just one insurer, it is almost always a Blue Cross Blue Shield plan. While those plans have generally expressed their commitment to continuing to offer ObamaCare coverage, they have also pressed the Obama administration for policy changes like tightening up the rules for extra sign-up periods that sick people can use to game the system.

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Some Blue Cross plans, including one in North Carolina, have expressed reservations about continuing to offer ObamaCare plans, particularly if they do not win their preferred policy changes.

Sabrina Corlette, an expert on the health law at Georgetown University, cited the geographic divergence when asked whether Aetna’s exit made her worried about the future of ObamaCare.

Corlette said her concern is “going to depend on what county somebody might live in.”

At Least Six Swing States Face Double-Digit Premium Hikes under Obamacare

by ALEX SWOYER16 Aug 2016Washington, DC

Double-digit Obamacare premium hikes projected in 2017 may bode in Donald Trump’s favor, as several swing states are being impacted by double-digit increases under the law and consumers are expected to see the hikes around Nov. 1 — one week before heading to the polls.

Trump has promised to repeal and replace Obamacare, but Hillary Clinton has vowed to make the Obamacare exchanges work. Some say the way she would do that is through raising taxes.

“Any reports of premium increases will immediately become talking points on the campaign trail,” stated Larry Levitt of the Kaiser Family Foundation. “We’re in an election where the very future of the law will be debated.”

The Heritage Foundation found dramatic increases on premiums in Wisconsin and Florida as well as Michigan, Virginia, Pennsylvania, and North Carolina under the law in comparison to before Obamacare went into effect. Currently, insurers in the Obamacare marketplace in North Carolina, Ohio, Pennsylvania, and Illinois are wanting double-digit hikes on premiums.

Blue Cross and Blue Shield of North Carolina is reportedly requesting to increase rates by more than 18 percent, while in Ohio, the average requested hike is around 10 percent. In Pennsylvania, companies want hikes averaging 23.6 percent, according to the Pennsylvania Insurance Department.

The next president may face the meltdown of Obamacare, as Aetna announced on Tuesdaythat it’s pulling back coverage in 15 states and will only remain in four states due to a $200 million dollar loss.

The Obama administration argues that Aetna’s move isn’t a sign of trouble for Obamacare, according to The Hill.

“Aetna’s decision to alter its Marketplace participation does not change the fundamental fact that the Health Insurance Marketplace will continue to bring quality coverage to millions of Americans next year and every year after that,” stated Kevin Counihan, CEO of ObamaCare marketplace.

But Aetna isn’t the only insurer facing cost issues in the Obamacare exchanges. UnitedHealthcare and Humana are also major insurers that are pulling back.

The news comes as record high premium spikes are expected in 2017.

Fox News cites The Kaiser Family Foundation report that revealed low cost plans under Obamacare face an 11 percent hike. The District of Columbia is facing a 21 percent hike in premiums while Portland is facing a 26 percent hike. New York City faces a 16 percent increase in premiums.

Illinois’ Obamacare plans seek big 2017 premium hikes

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Insurance premiums for Obamacare will rise an average of 11 percent, according to a new study from the Kaiser Family Foundation.


Insurers want to crank up the cost of health insurance premiums by as much as 45 percent for Illinois residents who buy coverage through the Affordable Care Act’s marketplace.

Blue Cross Blue Shield of Illinois, the most popular insurer on the state’s Obamacare exchange, is proposing increases ranging from 23 percent to 45 percent in premiums for its individual health-care plans, according to proposed 2017 premiums that were made public Monday. The insurer blamed the sought-after hikes mainly on changes in the costs of medical services.

Blue Cross Blue Shield of Illinois said in a statement that the proposed rates are in line with those in many markets across the country, and the proposed increases don’t tell the whole story.

“No final decisions have been made regarding our 2017 offerings,” according to the statement. “While some carriers have chosen to exit the market, we are working toward continuing to provide health insurance options for consumers in Illinois. However, that must be done in a sustainable way.”

Coventry Health Care of Illinois proposed rate increases as high as 21 percent.

The Illinois Department of Insurance has until Aug. 23 to review the proposed rates and potentially try to negotiate them down. Final rates can be lower than the ones first proposed by insurers, and the proposed increases don’t reflect what consumers will actually pay, the U.S. Department of Health and Human Services was quick to caution Monday.

Last year, average monthly premiums for consumers with HealthCare.gov coverage increased by $4, to $106 a month “despite headlines suggesting double-digit increases,” HHS spokesman Jonathan Gold said Monday in a statement. About 75 percent of Illinois residents who buy plans on the exchange qualify for federal tax credits that partially offset the costs of their premiums.

“Consumers in Illinois will continue to have affordable coverage options in 2017,” Gold said in the statement. “Today’s announcement is just the beginning of the rates process, and consumers will have the final word when they vote with their feet during Open Enrollment.”

Kathy Waligora, director of EverThrive Illinois’ health reform initiative, said she also expects many of the rates to be lower than the proposed ones released Monday.

“We don’t put too much stock in the numbers as they stand right now because we know the [Department of Insurance] is really negotiating the rates up until the last deadline,” she said.

Ultimately it will be insurers setting the rates that will take effect Jan. 1. Illinois, unlike a number of other states, doesn’t have the power to reject the proposed rates outright, said Dena Mendelsohn, a staff attorney at Consumers Union, the advocacy and policy division of Consumer Reports.

Regulators in some states, such as California, have been very successful negotiating with insurers to push down proposed rates in the past, she said. That hasn’t been the case everywhere.

“It doesn’t appear to me like the Illinois rate regulator is rigorously reviewing these rate proposals and advocating for consumers,” Mendelsohn said.

Consumer advocates have also complained that Illinois takes too long to publicly release its rates, giving advocates less time to review plans and fight proposed increases. Insurers had to submit their rate plans for Illinois in April, though they were just released publicly Monday as required by the federal government.

Other states make the rate plan proposals public when they are filed, and before Monday, more than half of the states had disclosed just how much higher Obamacare premiums could be. Blue Cross Blue Shield of Texas, for example, proposed an average increase of 53.7 percent.

The increases aren’t a surprise as many insurers have been losing money in the marketplace, said Katherine Hempstead, a senior adviser at the Robert Wood Johnson Foundation.

Hempstead said Illinois regulators tend to be realistic about just how low proposed rates can go.

“I don’t think the Insurance Department wants to push the carriers off a cliff and tell them they can’t raise their rates and then they’re upside down actuarially,” Hempstead said. “You can’t sustain a situation where most carriers lose money.”

She noted, however, that recent news of insurer Cigna’s plans to start selling marketplace plans in the Chicago area is likely good news for consumers. The additional competition could help hold down prices.

It’s at least one bright spot for Illinois residents on the exchange, who have been battered by other developments.

Insurer Land of Lincoln Health stunned 49,000 enrollees with its announcement this summer that it would shut down Oct. 1, after sustaining heavy financial losses. And last year, Blue Cross Blue Shield of Illinois decided to discontinue its broadest PPO plan on the exchange after losing money.