People shopping for insurance through the Affordable Care Act in yet more regions could face higher prices and fewer choices next year as insurance companies lay out their early plans for 2018.
Blue Cross and Blue Shield of North Carolina is asking regulators for a 23 percent price hike next year because it doesn’t expect crucial payments from the federal government to continue. That announcement comes a day after Blue Cross and Blue Shield of Kansas City said it will leave the individual insurance market next year, a decision that affects about 67,000 people in a 32-county area in Kansas and Missouri.
The Kansas City company’s decision also will leave shoppers in 25 counties with no options for coverage sold on public insurance exchanges, unless another insurer steps in, according to data compiled by The Associated Press and the consulting firm Avalere. The law’s insurance exchanges are the only place where people can buy coverage with help from an income-based tax credit.
Other insurers around the country, such as Aetna and Humana, have already said they will not offer coverage on exchanges next year, though several, including Centene, say they will.
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Options are growing thin in many markets. The Kansas City insurer’s decision means that only 10 of Missouri’s 115 counties will have more than one insurer selling coverage on the exchange next year.
Blue Cross and Blue Shield of North Carolina sells coverage in all 100 North Carolina counties, and it is the lone option in 95. It said Thursday that its participation for next year is not guaranteed.
Insurers still have a couple months to consider their options before finally committing to selling coverage in 2018.
The North Carolina insurer said it expects no help from federal cost-sharing reduction payments next year, and that’s reflected in its initial rate request that calls for a 23 percent price increase, on average. If it could be assured of the subsidies that are part of the law and have been paid in the past, it said prices would rise about 9 percent. The insurer covers more than 460,000 people who bought coverage on the exchange.
It said about two thirds of those customers get cost-sharing help, but the price increase for providing insurance without this help will be spread over all of its customers in that market.
“Many ACA customers will pay more for coverage that is already a large portion of their household income,” said Brian Tajlili, director of actuarial and pricing services for the insurer.
The government has been giving insurers money to help customers with modest incomes cover out-of-pocket expenses like co-payments and deductibles. But the future of those payments, which are separate from the income-based tax credits that help people buy coverage, is in political limbo.
Republicans had sued the Obama Administration to stop the subsidies, and that case is now tied up in court. President Donald Trump’s administration has sent mixed signals over how it will pursue the case or whether the payments will continue. Insurers want some assurance that the payments, which total about $7 billion, will continue through 2018.
Tajlili said his company wants to see some sort of a legal guarantee, like Congress appropriating the money, in order to feel comfortable that the payments will actually be made through 2018.
Some of the biggest companies on the exchanges have yet to announce their coverage plans for next year. Those include Anthem Inc., which covers more than 1 million people through Affordable Care Act exchanges, offering Blue Cross-Blue Shield insurance in large states like New York, California and Ohio.
Many insurance companies have faced large financial losses selling this type of insurance and have responded by either raising prices or abandoning that kind of coverage altogether. Blue Cross and Blue Shield of North Carolina said earlier this year that it lost $38 million on ACA plans last year and more than $400 million between 2014 and 2015.