If you get your health insurance through the state exchange or individual market, your rates could be going way up next year.
The proposed 2018 rate changes released by the Insurance Commissioner’s Office on Monday reveal an average 22.3 percent increase, across the 11 insurers filed.
The range includes an average rate change of 38.5 percent proposed by Molina Healthcare of Washington to 12.9 percent proposed by Kaiser.
Chart: Proposed average rate changes (via Office of the Washington State Insurance Commissioner)
Insurers are also offering fewer plans: 39 proposed qualified health care plans compared to 98 offered in 2017, according to the Washington Health Benefit Exchange.
Eight counties only have one health insurer servicing the individual market; they include Chelan, Douglas, Ferry, Island Pend Oreille, San Juan, Skagit, and Skamania.
“Bottom line, we are seeing counties with fewer choices, and many consumers are now seeing only once choice in their country,” said State Exchange CEO Pam MacEwan during a hearing before state lawmakers.
“All of these counties are vulnerable, and we really need to be working on solutions now,” MacEwan continued.
Initially no insurers had filed in Grays Harbor and Klickitat Counties, but Premera announced Monday that it would offer insurance options in Grays Harbor after all.
“While I don't have an insurer right now for Klickitat County, it's one that I'm going to continue to work on,” Insurance Commissioner Mike Kreidler told lawmakers.
“We’re having conversations specifically with Molina and Regence to see if we can get them back into those markets,” he said.
Nationwide, rural counties have been hit hardest by the ongoing marketplace instability, often times facing higher rates and fewer options.
“Rural counties have some unique challenges,” said Meg Jones, executive director of the Association of Washington Health Care Plans. “They have fewer providers, which means the cost of care is higher. They also have fewer specialty care providers, and so the membership needs to travel further to get care that’s specialized in nature. In addition, the rural counties have a different population mix, some of whom are going to be sicker, because they’re older."
Jones said other factors contributing to higher rates include the cost of medical care and the high cost of prescription drugs.
“Premera’s proposed rate increases are due primarily to increased medical and pharmacy costs, which is driving over 80 percent of that rate increase,” said Sheela Tallman of Premera during the hearing.
She said their pharmacy claims also grew by nearly 40 percent.
Stakeholders and insurers also cited ongoing political uncertainty over the GOP health care bill that proposes to repeal and replace the Affordable Care Act, as well as uncertainty over whether the Trump administration will continue to provide ACA subsidies.
“When there’s uncertainty, such as whether or not the individual mandate is going to be enforced, whether the cost sharing reduction subsides are going to be paid…that leads to a need to increase rates so that the uncertainty is accommodated,” said Jones.
Meanwhile, Washington Republicans Cathy McMorris Rodgers and Dan Newhouse, who supported the GOP health care bill that passed the U.S. House last month, said the rising rates are proof the Affordable Care Act isn’t working.
“Despite state efforts to prop up this flawed, unstable law, it is clear that Obamacare is on an unsustainable path in our state. We refuse to allow this failed government-knows-best approach to healthcare to cause more damage,” said a joint statement, in part, from McMorris Rodgers and Newhouse.
However, critics of the Republican bill blame the repeal effort for compounding the confusion as insurers try to calculate the future.
“We work within the laws that are established. When we know what those laws are, it's a lot easier for us to do that,” said Jones.
The Insurance Commissioner’s Office will spend the next few months reviewing the proposals before approving the changes, likely in September. Open enrollment begins in November.
Note that the proposed changes do not impact Medicaid recipients, and it's unknown how the rate changes will impact individuals who are eligible for subsidies to offset the monthly cost.
Meanwhile, the Washington arm of the National Federation of Independent Business took aim at the proposals via Twitter, writing “As SmallBix owners, working families mull 13-39% health insurance rate hikes, WA’s three leading carriers are sitting on a $3.5 billion surplus.”
The tweet references the combined surpluses of Regence, Premera, and Kaiser (formerly Group Health), according to documents provided by the Insurance Commissioner’s Office.
KING 5 has reached out to the three insurers mentioned. Premera was the only one to respond by deadline.
“We keep a reserve in order to ensure we can continue to pay member claims even under a worse-case scenario. We also use the reserve to make continued improvements in our business, since unlike a publicly traded company, we have no access to capital markets,” said a spokesperson from Premera.
Additional statements from Insurers on proposed rate changes:
Molina: “The preliminary rates Molina Healthcare filed in Washington take into consideration uncertainties around the individual marketplace as well as increasing costs. Molina is constantly looking for ways to improve access to affordable, high quality health care for people receiving government assistance. We will continue to work closely with our state and federal partners on innovative solutions to achieve that.”
Premera: “The proposed rate increases are due primarily to rising medical and pharmacy costs, as well as to uncertainty around the stability of the individual market with the anticipated loss of subsidized care through cost sharing reductions (CSRs) and weakening of incentives to purchase coverage. We believe approval of these rates will allow us to continue to serve customers in more counties than any other carrier on the Exchange, and achieve our goal of serving our individual market customers for many years to come."