Most health insurers selling individual policies in Oregon are once again seeking double-digit price hikes for 2018.
The proposed increases in premiums, or monthly prices, however, are overall not quite as high as they’ve been in recent years. Companies are seeking to raise premiums on their individual market policies — those people buying for themselves and their families — by an estimated average of 15.5 percent.
Those policies went up by an average of 27 percent for 2017 and 23 percent for 2016. Averages are determined in part by the number of people who enrolled in policies, so the exact 2018 percent increase can’t yet be determined.
On the low end, PacificSource Health Plans is requesting a 6.9 percent average premium increase across its individual market policies — a standard silver policy for a 40-year-old male in Bend would cost $473 per month. On the high end, ATRIO Health Plans is requesting a 21.8 percent increase — the same individual would pay $477 per month.
Moda Health Plan, which is returning to Central Oregon after retreating from the local market last year, proposes selling the most expensive policies: The aforementioned Bend man would pay $540 per month for the standard silver.
Insurance carriers in recent years have said steep price hikes are necessary because of the sicker-than-expected population that became eligible under the Affordable Care Act.
In public filings, carriers again reported their members were more expensive than expected in 2016, the most recent year for which data is available. Regence BlueCross BlueShield of Oregon, for example, spent 9.4 percent more than expected on its members in 2016. The company seeks to raise premiums by an average of 18.7 percent.
Similarly, Providence Health Plan reported spending 24 percent more on members’ medical care than expected. The company wants to raise premiums by an average of 20.7 percent.
“We know there are still many unknowns facing insurers and consumers as we look ahead to 2018,” Oregon Insurance Commissioner Laura Cali Robison, said in a statement. “Now that the filings are in, we will begin our vigorous review to ensure the proposed rate changes, including the potential impact of various sources of uncertainty, are actuarially sound and justified.”
Roughly 218,000 Oregonians are covered under individual market policies, about 5 percent of the state’s population. Most people with commercial insurance get it through employers.
Data from 2016 show Oregon’s insurance market may be stabilizing following big changes from the ACA two years earlier. Companies spent an average of $384 on each member per month in 2016, compared with $385 in 2015, according to the state Department of Consumer and Business Services, which regulates insurance in Oregon.
“There is not a continued worsening of the cost of the market,” DCBS Director Pat Allen told The Bulletin in an interview last week. “So there are a lot of factors that will argue for fairly stable rates.”
But there remains significant uncertainty around whether Congress will approve an ACA replacement plan and the Trump administration will fund $7 billion in annual payments to insurers. The latter comes in the form of cost-sharing reduction payments, which under the ACA reimbursed insurers for reducing out-of-pocket costs for low-income members.
Insurers are supposed to submit their proposed premiums assuming the ACA stays in place in 2018 and the cost-sharing payments come through. State regulators promise to work with companies on future changes if necessary.
Insurers in other states are proposing even higher increases. A major one in Maryland, for example, wants to increase rates by an average of more than 50 percent.
The credit rating firm S&P Global Ratings predicted in a recent report that while premiums will still increase in 2018, the market will continue to stabilize.
“If it remains business as usual, we expect 2018 premiums to increase at a far lower clip than in 2017,” the report said.
Some carriers wrote in documents filed with the state that they expect to see fewer healthy enrollees in 2018 due to the weakened insurance mandate. The Internal Revenue Service announced earlier this year it would no longer reject tax returns that don’t contain information about health coverage. That’s in response to the Trump administration’s executive order directing agencies to minimize the economic burden of the ACA. It’s unclear whether people will still be fined for not having insurance.
Oregon Sen. Ron Wyden, a Democrat, blamed the Trump administration for the proposed premium increases.
“Today’s news reflects the Trump administration’s continued efforts to sow chaos about the future of individual markets around the country with overt threats of sabotage,” he wrote in a statement.
For some, premium increases will be offset by tax credits through the ACA. The amount of subsidies people receive each year is tied to the lowest-cost silver plan in states’ markets.
Ample insurer choices
Central Oregonians will have plenty of insurers to choose from in 2018. Deschutes County briefly faced having only two companies selling individual market policies for 2017 until state regulators convinced more to enter the local market.
Five companies are proposing to sell individual policies in Deschutes County next year. One will only sell outside of HealthCare.gov, meaning people can’t use tax credits to help buy those policies. Crook and Jefferson counties will each have six insurers, three of which will only sell outside of HealthCare.gov.
Oregon fares better than many other states with respect to insurer choice. This year, one-third of the country has only one company in a region selling plans via HealthCare.gov, according to a 2016 report from the consulting firm Avalere.
A side effect of fewer insurers in Central Oregon in 2017 was the disappearance of policies that let members place money into health savings accounts, which help people pay for out-of-pocket medical expenses their health insurance policies don’t cover.
That won’t be the case in 2018, as DCBS has ensured that all standard bronze policies, a type of policy marketplace carriers are required to offer, will let people use their HSA accounts.
The small group market, which small businesses use to purchase coverage for their employees, has seen far less volatility in recent years than the individual market. In 2018, small group insurers want to increase premiums by between 2 percent and 8.5 percent.
The public will be able to comment on the proposed rates, which will be posted at oregonhealthrates.org, between May 22 and June 11. State regulators will review the proposed changes and announce their preliminary decisions on June 29. Final decisions will be released July 20.