Marketplace Plans Have Lower Premium Increases and Administrative Costs, Report Finds
A new report from The Commonwealth Fund finds that average 2016 premiums for individual off-Marketplace plans increased more than premiums for on-Marketplace plans—$48 versus $40 per member per month. The report, which compares the individual coverage markets on and off of Marketplaces using insurers’ most recent projections for ACA-compliant policies, also found that this lower premium increase among Marketplace plans appears attributable to a shift of enrollment toward HMO and “exclusive provider organization” plans. Insurers selling exclusively off of the Marketplace also projected slightly higher proportions of administrative costs (14.2% versus 11.7%) and profit (2.8% versus 2.0%). The study refutes concerns that insurers would sell less expensive and less comprehensive plans (bronze-level plans) off the Marketplace, attracting healthy enrollees and leaving less healthy and more expensive enrollees on the Marketplace. According to the authors, bronze-level plans constitute a similar proportion of coverage both on and off of Marketplaces.
Arkansas: Governor Seeks Transition to State-Based Marketplace on the Federal Platform
Governor Asa Hutchinson (R) has requested federal permission to transition from a State-Partnership Marketplace (SPM) to a State-based Marketplace on the Federal Platform (SBM-FP) for the 2017 plan year, according to the Arkansas Democrat-Gazette. The Arkansas Health Insurance Marketplace currently regulates plans on the individual Marketplace and administers the State’s Small Business Health Options Program (SHOP); under an SBM-FP model, the State would begin certifying the individual Marketplace plans and assume plan management and consumer outreach functions for those policies. Arkansas would continue to rely on HealthCare.gov’s eligibility and enrollment system, including the call center. The Governor’s spokesman said transitioning to an SBM-FP would decrease fees on insurers and could moderate future premium increases.
Alaska: Legislature Approves Reinsurance Program
The Legislature approved a plan to stabilize insurance premiums in the State's individual market, weeks after Moda Health Plan's exit left Premera Blue Cross Blue Shield as the only insurer on the individual market. The bill will use an existing tax on all health insurers to fund a reinsurance program for high-cost enrollees on the individual market. State Insurance Division Director Lori Wing-Heier said the individual market was in danger of collapsing if the Legislature did not approve the bill, according to Alaska Public Media. The bill also gives the Department of Health and Social Services authority to request a 1332 waiver from the federal government.
California: Undocumented Residents Move One Step Closer to Marketplace Coverage
The California legislature passed SB10, authorizing the State to seek a 1332 waiver to allow undocumented residents to purchase non-subsidized health insurance through the State-based Marketplace, Covered California. If Governor Jerry Brown (D) signs the bill and the federal government ultimately approves the 1332 waiver application, California would become the first state to allow undocumented residents to purchase full-price coverage through the ACA’s Marketplaces as soon as next year.