A year ago, insurers were fleeing the Affordable Care Act exchanges, worried about the law’s uncertain future with Republicans in control of the White House and Congress.
2019 is shaping up very differently … at least so far.
Last July, it looked like 42,000 people in 61 counties were at risk of having no choice of carriers for 2018 — though ultimately, every county had at least one option after state regulators scrambled to convince insurers to cover the bare areas. Still, the number of carriers who filed to participate in the exchanges for 2018 had dropped to 132, down from 167 a year earlier.
Now, insurers are entering or returning to at least a dozen states, while others are expanding their presence in the states in which they operate. And last year’s worries that some Obamacare enrollees could be left stranded have not resurfaced.
"This is a complete 180 from where were this time last year," said Cynthia Cox, director for the Kaiser Family Foundation’s Program for the Study of Health Reform and Private Insurance.
Though some uncertainty still looms over Obamacare, insurers are in a much better place this year than last, experts said. Many have started making a profit in the individual market and the threat of Congress repealing the law has waned.
Insurers had several rough years on the Affordable Care Act exchanges, with some racking up hundreds of millions of dollars in losses. The red ink led some insurers to leave or shrink their involvement in 2017 and 2018.
The election of President Donald Trump, who campaigned on repealing the health reform law on his first day in office, and Congress’ attempts to upend Obamacare last year sent even more insurers running for the exits.
Those that stayed jacked up their rates by 27%, on average, for 2018. This increase, which comes on top of a 21% hike the year before, helped them cover their policyholders’ medical care. As of late 2017, many insurers had profitable individual market businesses, Cox said.
Also, Obamacare will remain the law of the land for now since Republicans in Congress can’t muster enough votes to repeal it. Insurers are monitoring two big actions that will affect the law — Congress’ repeal of the individual mandate penalty for 2019 and the Trump administration’s broadening of two alternatives to Obamacare — but many feel they can cover those changes through increases in next year’s premiums.
"They can price for that," Cox said, of the changes. "They at least know the rules of the game."
Some carriers are looking to return to markets they exited. Take Molina Healthcare, which aggressively expanded on the exchanges until its board sent the CEO packing last year. The insurer then shrunk its presence for 2018, but is now looking to grow again. It has filed preliminary rate requests in Utah and Wisconsin for 2019 after having pulled out this year.
"We will continue to evaluate our participation on a market-by-market basis, and are optimistic about the opportunity of offering to more prospective members our high quality, affordable options through the Marketplace," the company said in a statement.
Other insurers are expanding their footprint. Anthem, a major player on the exchanges, has filed to offer policies in an additional 17 counties in Kentucky for 2019, for instance. This partially reverses the insurance titan’s shrinkage of its coverage territory in the Bluegrass State.
Asked why Anthem decided to expand in Kentucky this year, a spokeswoman replied with a statement saying "Ensuring consumers have access to individual health plans that offer greater affordability and access to quality health care remains our focus at Anthem."
Anthem, which provided Obamacare coverage in 14 states in 2017, but only nine this year, has not yet announced its participation in other states next year, she said. The insurer attributed its decision to downsize for 2018 to uncertainty in federal rules and operations, as well as a deteriorating individual market.
The insurers’ expansion means that more states will have at least two carriers in 2019, ensuring more competition for consumers. Medica plans to cover every county in Oklahoma, while Wellmark will be everywhere in Iowa. Both these states have only one carrier this year.
Several of the insurers that are broadening their coverage territory are small start-ups. This includes Oscar Health, which started in New York when the exchanges opened in 2014. It has slowly been increasing its footprint, mainly adding large cities, such as Dallas, Los Angeles and Nashville.
Next year, it plans to enter three new states — Florida, Arizona and Michigan — and expand into new areas in Ohio, Tennessee and Texas. The insurer feels the Affordable Care Act market is stable in many parts of the country.
"We believe it is and will be a great market for insurers," said Nick Reber, a senior vice president at Oscar.
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