By Anna Wilde Mathews
Blue Cross and Blue Shield of Kansas City plans to pull out of
the Affordable Care Act health-insurance exchanges, a move that
likely leaves a swath of northwestern Missouri with no available
marketplace plans for next year.
The nonprofit is the sole marketplace insurer in 25 counties in
Missouri, according to the Kaiser Family Foundation. Unless another
insurer steps in, people who purchase individual insurance plans in
those counties will have no options on the exchange, and thus will
be unable to obtain federal subsidies that help pay premiums for
most enrollees.
The decision by the Kansas City insurer is the latest sign of
strain in the ACA exchanges, which sell health insurance to
individuals. Humana Inc. and Aetna Inc. have already announced they
will next year leave all of the marketplaces where they currently
sell plans. Some insurers have been seeking large rate increases,
citing claims costs and regulatory uncertainty.
Insurers have also said that more rate increases and withdrawals
are likely if the Trump administration and Congress don't commit to
continuing federal "cost-sharing" payments that support reduced
costs for low-income ACA enrollees.
Thursday, a different insurer, Blue Cross and Blue Shield of
North Carolina, said it was proposing an average rate increase of
22.9% on its 2018 ACA plans, but the increase would be 8.8% if the
cost-sharing payments were guaranteed. "At this point, we did not
have the confidence in receiving that funding," said Brian Tajlili,
director of actuarial and pricing services for the North Carolina
insurer. He said the marketplace in the state appeared to be
stabilizing.
Other states, like Missouri, are facing the risk that some
counties will be left "bare" and exchange consumers won't have any
insurance products available. In Iowa, Medica has said it is
considering withdrawing from the exchange, a move that could likely
leave much or all of the state with no marketplace plans following
earlier departures by other insurers.
Earlier this month, BlueCross BlueShield of Tennessee filled a
potential gap left by Humana's exit when it said it would offer
plans in the Knoxville region next year.
Blue Cross and Blue Shield of Kansas City said it decided to
pull out after losing more than $100 million on ACA plans through
2016. It will stop offering exchange plans in its coverage area,
which is 30 counties in northwestern Missouri and two counties in
Kansas.
"This is unsustainable for our company," said Danette Wilson,
chief executive of Blue Cross and Blue Shield of Kansas City, in a
statement. The move will affect approximately 67,000 people, the
insurer said. It began offering plans in 2014.
Missouri has seen a number of exits from the exchange, though
not all counties will be left bare by the Blue Cross pullout. Last
year, UnitedHealth Group Inc. and Aetna Inc. both offered
marketplace plans in the state, but they exited after 2016. Humana
is also a current Missouri exchange insurer, according to the
Kaiser foundation.
Anthem Inc., another major exchange player in Missouri, has said
it is reconsidering its marketplace business. If the cost-sharing
payments aren't locked in, Anthem has said it would consider
pullbacks and exits, as well as sharp premium increases, for next
year.
The lack of any exchange plans in a region presents a unique
challenge. The ACA mandates that most people acquire health
coverage, and offers subsidies to help lower-income consumers buy
plans. To obtain the subsidies, though, people are supposed to buy
their plans through health-law exchanges.
Federal regulators are able to spare people from the law's
penalty for noncoverage under certain circumstances, and they could
offer some sort of waiver to people in counties with no exchange
plans, experts said.
But the current law doesn't appear to leave any wiggle room that
would allow people in places with no exchange plans to obtain
subsidies to help with their premiums, experts said. If insurers
are still selling individual coverage outside the ACA exchange,
those consumers could potentially purchase it, but they wouldn't
get the federal aid. "I don't see any way around that," without
changing the law, said Timothy S. Jost, an emeritus professor at
Washington and Lee University.
Consumers like Doug McBride, 62 years old, of Des Moines, are
worrying about what will happen. Mr. McBride, who owns his own
photography and video-production business, currently has an Aetna
exchange plan, and already knows he will have to switch insurers
next year when Aetna withdraws. But if no insurer offers plans on
the marketplace, he could lose access to the federal help that pays
about $1,000 a month toward his and his wife's combined monthly
premium of nearly $1,300.
Without the federal subsidy, Mr. McBride said, he would likely
not be able to afford coverage, and he would return to being
uninsured, as he was before the ACA's main provisions kicked in in
2014. "We are scared about it, we're really worried about it," said
Mr. McBride, who takes a blood thinner because of a clotting
condition stemming from surgery he got after an old injury.
Some companies, figuring that a number of consumers could be
trapped in such situations, are working on alternatives. EHealth
Inc. executives said the company is working on lower-cost coverage
options that will fall short of the full protections of major
medical plans, but likely be more affordable than ACA-compliant
insurance.
Write to Anna Wilde Mathews at anna.mathews@wsj.com
(END) Dow Jones Newswires
May 25, 2017 12:47 ET (16:47 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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