Kentucky’s Obamacare customers are likely to see rate hikes next year — but much smaller ones than in the recent past.
Some Kentucky customers who get insurance through the federal health exchange will even see some competition among insurance providers because Anthem is increasing the number of counties in which it is offering plans.
Health insurers have filed with the state their preliminary rate requests for 2019, with Anthem requesting an average increase of 3.5 percent over 13 plans, and CareSource proposing an average 19.4 percent hike for its 12 plans.
Kentucky Department of Insurance analysts will review the requests and are expected to finalize any rate changes by late August. Open enrollment for 2019 will begin Nov. 1.
Kentucky Insurance Commissioner Nancy Atkins said in a news release that while this year’s rate hike requests are smaller than in prior years, some Kentuckians will face increases on already “unaffordable” insurance premium rates.
The rates represent averages, which means individual premiums can be different as they will depend on factors including age, smoking habits and geographic location.
Last year, the DOI approved increases of 41.2 percent for Anthem and 56 percent for CareSource. No other insurance company is providing health insurance plans for Kentucky under the federal health care exchange set up under the Affordable Care Act, informally known as Obamacare.
The rates affect about 77,500 Kentuckians who get insurance through the ACA. They do not affect people who get insurance through government programs such as Medicare and Medicaid or the roughly 511,000 Kentuckians who get insurance through their employers.
Indianapolis-based insurer Anthem this year is providing coverage in 59 counties, while CareSource, a nonprofit management care company based in Dayton, is offering plans in the remaining 61 counties.
CareSource’s coverage area will not change next year, the DOI said, but Anthem will expand its coverage to another 17 counties. That means ACA customers in those counties will be able to choose among plans from Anthem and CareSource. Customers outside of those counties will have access to plans from only one of the providers.
Anthem could not be reached immediately to talk about its expansion plan. In its filing, the company said that it is requesting a rate increase because it expects “growing market volatility” in part because it has experienced “market shrinkage and morbidity increases year over year.”
Insurance companies had struggled in recent years to price their exchange plans appropriately. Insurers including Louisville-based Humana have said that the exchanges are primarily attracting sicker people whose health care premiums are not enough to pay for their health care. Humana left the individual market this year because of steep losses in that market and because of uncertainty about the ACA’s future. Republicans have repeatedly tried to dismantle the law.
Analysts have warned that so-called association health plans, which allow more businesses to join forces to buy health coverage in bulk and which received a boost this month from the Trump administration, could undermine the ACA’s viability. Kaiser Health News said the association plans “will likely siphon away employers with relatively healthy consumers from ACA coverage into less-expensive trade association plans.” That would probably lead to higher prices for plans offered on the ACA exchanges.
And the U.S. Justice Department in filings with a federal court in Texas said that one of the ACA’s key provisions, the so-called individual mandate, which requires individuals to sign up for health insurance or face a financial penalty, is unconstitutional, according to Reuters. Without that penalty in place, analysts fear that younger, healthier people will decline to sign up for insurance, which would leave a greater share of older, sicker patients in the insurance pool. And that likely would require insurers to raise health premiums.
Atkins said in a news release that while “the federal government has begun undertaking certain regulatory reforms … much work is left to be done to provide meaningful relief for Kentuckians.”