Only one company selling through exchange next year
Okanogan County residents who buy their own health insurance will have more limited choices next year, with only one company selling policies through the state exchange — where people can get a subsidy — and one selling outside the exchange.
The shrinking pool continues a trend. In 2018, two companies sold policies through the state exchange and another outside the exchange. In 2017, three companies offered plans through the exchange.
LifeWise Health Plan of Washington has told the Washington Office of the Insurance Commissioner that it plans to offer four policies in Okanogan County in 2019 — one bronze, two silver and one gold. One of the plans includes health-savings accounts.
Asuris Northwest Health proposes selling five plans outside the exchange in Okanogan County — two bronze, two silver and one gold, two with health-savings accounts. None of the Asuris plans will be eligible for subsidies.
Bronze plans have the lowest monthly premium but the highest deductible and out-of-pocket costs. Gold plans have higher premiums but lower deductibles and out-of-pocket costs. Subsidies are available based on income.
This week, the insurance commissioner released insurers’ requests for rate increases for next year. LifeWise is seeking a 6.84-percent increase and Asuris is seeking a 5.73-percent increase.
These increases must still be reviewed by the insurance commissioner. A final decision is due in the fall. The companies have to justify their rates, said Stephanie Marquis, a spokesperson for the state Office of the Insurance Commissioner.
While the rate hikes sought by LifeWise and Asuris are not insignificant, they are lower than in the past — last year LifeWise hiked its rates by 34 percent and Asuris by 25 percent.
They’re also less than the requests from other insurers. One company that sells insurance in the most-populous counties in Washington is seeking a nearly 30-percent rate hike.
The biggest cost driver is an increase in use, coming in part from new geographic rating areas created by the state. The redistricting was intended to stabilize the insurance market and minimize the chance that some counties would be without an insurer, according to the insurnace commissioner.
Impact of federal policy
In reviewing the rate requests, the insurance commissioner will ask the companies to explain the extent to which federal actions are affecting their rates, said Marquis. The commissioner is concerned that insurers are raising rates to compensate for uncertainty created by Pres. Trump and Congress, who have been trying to repeal — or at least weaken — the Affordable Care Act (ACA, or Obamacare), she said.
Although the ACA requires everyone to have health insurance, starting in 2019, there will be no penalty for not having insurance.
Prescription drugs are one of the biggest expenses for insurers, said Marquis.
Another significant cost to insurers is the labor-intensive process of negotiating contracts with a network of providers and hospitals, particularly in rural areas, said Marquis.
Another effect on costs grows out of a 2017 decision by Pres. Trump that the federal government would no longer reimburse insurance companies for the cost-sharing reductions — the subsidy that lowers out-of-pocket costs for doctor’s visits and medications.
People who qualify for cost-sharing still get the savings but, because insurance companies aren’t being reimbursed, the insurers have raised premiums to make up the difference. Last year, rates went up about 10 percent because of this shift, said Marquis.
The White House is also proposing an expansion of health plans exempt from Obamacare rules. These include association plans and short-term medical plans.
Association plans have typically been available to people within a certain industry, but Trump proposes easing that restriction, said Marquis. The Trump administration also wants to increase offerings of short-term medical plans, which had been limited to a three-month term, so that people can get them for up to a year.
Short-term plans are different from typical insurance in that they are not renewable, so every time someone wants to continue coverage, the person must apply for a new policy. That can mean that someone who has become seriously ill will not be covered for that condition under a new plan, according to Kaiser Family Foundation, a nonprofit organization that provides information on national health issues.
None of the short-term plans covers maternity care and most don’t cover prescription drugs, according to Kaiser. As a result, short-term plans tend to be less expensive.
The ACA doesn’t allow insurance companies to deny coverage for pre-existing conditions. It also mandates 10 essential benefits, including hospitalization, preventive care and mental health care.
Health insurance specialists are concerned that short-term and association plans could divert younger, healthier people from the primary individual market, thereby affecting the risk pool, said Marquis.
The insurance commissioner is considering restricting short-term plans in Washington to three months without the option to reapply. That would enable people who missed open enrollment to get coverage, but then direct them back to the regular state exchange.
The Office of the Insurance Commissioner has received hundreds of complaints over the past several years regarding short-term and association plans. Some people filed a complaint when they discovered a plan did not cover a particular medical condition. Others said they had been misled by agents, said Marquis.
The insurance commissioner is working on a requirement for clear disclosures about these insurance products sold outside of the individual market, she said.
Universal health care in Washington?
A grassroots coalition of health care professionals and activists has created Whole Washington to push for universal health coverage for all residents. They’re still in the process of gathering signatures to get the initiative on the November ballot.
If approved, Initiative 1600 would provide all Washington residents with physical, mental, dental and vision care. There would be no out-of-network fees, deductible or co-pays. People earning more than twice the federal poverty level would have co-pays for prescription drugs, but out-of-pocket expenses would be capped at $250. It would cover in- and outpatient health care, with no deductibles or co-pays.
The initiative proposes to pay for the coverage through several new taxes:
Individuals would pay a tax of 1 percent of their adjusted gross income, although the first $15,000 would be exempted. For example, someone earning $20,000 would pay $4 per month, and someone earing $80,000 would pay $54 per month. Individual contributions would be capped at $200 per month.
People who have income from capital gains would pay 8.5 percent a year on those earnings.
Employers would contribute 8.5 percent of each person’s gross pay. Initially, employers could opt in or out, but once more than half the population is covered by Whole Washington, employers would have to participate. Whole Washington expects their plan will attract employers because it would be less expensive than the average 12-percent of an employee’s salary currently spent on health care.
The initiative would also eliminate provider networks and the requirement for referrals and prior authorization for treatment.