Dive Brief:
- Major Pittsburgh-based insurer Highmark is cutting its participation in Pennsylvania's ACA marketplace by more than half for 2017, reported the Tribune-Review.
- The insurer is dropping 27 of the 49 counties it served in 2016, and overall, about 70% of its customers will lose their plans.
- The state's insurance commissioner, Teresa Miller, told the media she approved premium increases averaging 50% for Highmark's 2017 plans to keep it from walking away entirely.
Dive Insight:
Highmark's pullback follows that of numerous other insurers that have scaled back around the U.S. and further contributes to the matter of decreased competition. Pennsylvania's ACA market was already feeling the sting of total departures for 2017 by Aetna and UnitedHealthcare.
Now, there will be 11 Western counties in the state with just one insurer serving their region, the Tribune-Reiew noted, meaning more consumers will be facing monopolies -- an issue increasingly being seen around the U.S., particularly in rural areas -- and will thereby have less recourse in the event of rate increases and negative plan choices.
The further concern is whether the departures in Pennsylvania will mount as the remaining participants have to take on the consumers that previous insurers found unprofitable, Miller said.
Analysts noted the counties where Highmark is remaining all have at least one other insurer participating, which could be by design to avoid taking on all the region's "bad risk." However, Highmark disputed that, telling the Tribune-Review its decisions were based on where it could develop its best provider partnerships.
Highmark has lost more than $800 million on its ACA business since 2014 and is among those insurers attempting to sue the federal government for failing to come through on previously promised risk program funds.