Payers re-committed, pulled back and pulled out of the Affordable Care Act (ACA) exchanges for 2018 in a final flurry of action on the preliminary deadline for 39 states that offer ACA exchanges plans through healthcare.gov. For example, Cigna pulled out of the Maryland individual market.
On Wednesday, Anthem, which sells Blue Cross Blue Shield plans in 14 states, announced it will pull out of two states, Wisconsin and Indiana. Also, MDwise said it is leaving the Indiana exchanges. This will leave four Indiana counties without an option. Independence Blue Cross said it plans to stay in the exchanges, but may change its mind because of market instability.
Payer startup Oscar Insurance said it plans to expand its region. Oscar will enter Tennessee and Ohio, broaden its coverage area in California and New York and re-enter the New Jersey exchange. Oscar had pulled out of the Garden State’s exchanges last year.
Wednesday's deadline isn't the last change insurers have to decide exchange markets are too unstable. Payers say they need cost-sharing reduction payments to survive financial in the markets, and while President Donald Trump's administration quietly paid the CSRs for June, it has not said whether it plans to continue to do so.
Highmark Health, Kaiser Permanente, Cigna, Molina Healthcare, Blue Cross Blue Shield of Tennessee and Health Care Service Corp. (HCSC) have all said in recent days they will participate in the exchanges in 2018, though HCSC and Highmark both said they might change their minds before September, when payers must make their final decisions. Other payers have recommitted to the ACA exchanges, including CareFirst BlueCross Blue Shield, which said it’s lost millions on the exchanges, and BlueCross BlueShield of North Carolina, which may institute hefty rate increases next year.
Also in recent weeks, Centene announced it will expand its ACA offerings to another three states and BlueCross BlueShield of Tennessee said it planned to move back into 16 counties in eastern Tennessee that would have no exchanges options after Humana announced it’s pulling out. Medica intends to stay in the Iowa market and Blue Cross Blue Shield of Alabama will offer plans in all counties.
Meanwhile, these payers announced over the past couple of months that they plan to pull out: Aetna, Humana, Wellmark Blue Cross Blue Shield and Blue Cross and Blue Shield of Kansas City. Also, UnitedHealth will only offer ACA exchange plans in a “handful of states” in 2018.
So the market will have fewer payers next year, but Wednesday was no "nightmare scenario" where insurers fled the markets en masse.
That’s the ACA exchange market for 2018 at the moment, but changes could still happen. A major factor will be whether the Republican-led Congress and the Trump administration back CSR payments. The administration has sent mixed messages about whether it will continue the practice. A recent Oliver Wyman study found that 42% of payers surveyed said they will pull out of the exchanges if CSR payments end.
That survey also found that 43% of payers said they plan on rate increases of 20% or more in 2018, which is a higher percentage than an earlier April survey that found only 25% of payers planned a 20% or more rate increase.
Overall, the straight rate increase average of surveyed payers for 2018 is 20%, which is slightly less than the weighted average rate increase of 22% in 2017, according to Oliver Wyman.
Another problem is that 44 counties in Ohio, Washington and Missouri, which make up about 31,000 enrollees, will have no payers next year. Plus, there are the four Indiana counties that could be in a similar situation after the announcements of Anthem and MDwise.
There is also the issue of people only having one choice. Avalere recently found that 41% of counties may only have one payer option in 2018. Less competition among payers is likely to increase costs for providers.
Finally, for people who have coverage, they face hefty premium increases. For the second straight year, the average rate increase is expected to reach 20%.
The ACA markets do not appear to be in a “death spiral,” at least not yet, but it has significant coverage and unsustainable rate increase issues. One way to resolve these issues is a greater commitment from the White House or Congress. That isn't likely in the coming days, however, as the Senate pushes to vote on its version of the American Health Care Act. The market will continue to teeter without support for CSR payments.