What to Do if Your Health Insurance Carrier is Leaving Your State
Health insurance in the United States is complicated. A blended approach of federal and state-level control over health insurance marketplaces across the country leaves every state with a unique situation – and often leaves policyholders’ heads spinning. And now, the spotlight has turned to insurance companies themselves, as multiple major carriers are announcing plans to withdraw from certain states’ marketplaces.
According to research from Kaiser, the average number of health insurance plans from which Americans can choose is decreasing. Particularly for those who will no longer be covered in 2017 by their current health insurance carrier, this guide is a no-nonsense explanation of which insurance companies are exiting their states, what those states are, and what to do about it – in plain English.
A Brief Overview of Health Exchanges… and Why it Matters for You
Since the Affordable Care Act passed in 2010, the federal government developed a number of “exchange programs” (marketplaces) to meet the preferences and needs of different states. Essentially, there are two types of exchanges: there are health insurance exchanges run by the federal government, and there are those run by the states.
Additional layers of this organization now exist, leading to a few other exchange configurations. Below is a summary or the major marketplaces from which you can buy health insurance.
Federally-Facilitated Exchange (FFE)
In this type of healthcare marketplace, the state opts for implementation of the federal exchange. It’s designed by the federal government and operated through the HealthCare.gov website.
One variation, introduced in 2013, is called the “Marketplace plan management exchange.” This option enables states to participate a little more actively than the original FFE setup by allowing them to certify insurance plans sold in their state.
State-Based Exchange (SBE)
Part of the Affordable Care Act included an option for states to design and implement their own exchange programs, such as California or “Covered California”. This option allowed states to tailor a system directly to their specific needs rather than implement the more generic federal program. Some states opted for this but ultimately ran out of time, such as Idaho and New Mexico, resulting in the implementation of a FFE.
A variation of this exchange is called the “Bifurcated Exchange.” This inclusion is about small business owners. It allows for the state to run small business exchanges while leaving the federal government to run insurance exchanges for individuals.
State Partnership Exchange and Supported State-Based Exchange
These exchange configurations are a little bit of both federal and state control. Subscribers still go to the HealthCare.gov website to purchase health insurance coverage, but states under these types of setup have more oversight than states choosing a direct FFE.
So why does all this matter to the everyday consumer? After all, research indicates that premiums are similar for policyholders through an FFE or a SBE. However, the market environment created by these layers of exchange programs has had a turbulent effect on insurance companies. And this is where it can have an effect on you, the amount of money you pay, and even your coverage for 2017.
Regulatory changes and a constantly shifting environment (lots of states have changed their models over the past several years) has lead to instability in the market. For carriers large and small, this has big implications – which translate to the price (or even availability) of their insurance plans for you, the consumer. For instance, the number of insurance carriers in your state can easily affect the amount you pay for health insurance.
In some cases, competition between carriers can help drive prices down, and in others, low numbers participating carriers can indicate high regulatory costs on the insurance companies’ end, which may translate to increased costs to you.
Understanding Why Carriers Are Exiting States
In order to understand why carriers are pulling their insurance plans out of exchanges, it’s necessary to think like an insurance company. For both large and small insurance carriers, they like to look at things like “risk adjustment” estimates to make predictions.
Recently, these have not been stable.
Let’s take a look at a few examples. UnitedHealthcare will compete in just three states in 2017 – that’s a 31 state drop. This large departure is usually due to a combination of big financial losses and market unpredictability. Aetna, which additionally cited huge financial losses as its reason for leaving the exchanges in 11 states, also added that high insurance premiums are causing individuals to only buy insurance when they are sick, and drop it when they are healthy. While this is technically illegal, high premiums still drive consumers to do this, and it does have an effect on cost.
Is Your State Affected?
Below are the carriers that are exiting state marketplaces in 2017. This list may grow, and a great resource for keeping up-to-date on your state can be found here. So far, the major carriers leaving multiple states are as follows:
Aetna – Aetna is exiting all but four of its states, amounting to 11 market withdrawals. It will remain in Iowa, Delaware, Nebraska, and Virginia.
Humana – Exiting Alabama, Arizona, Colorado, and Utah
UnitedHealthcare – For 2017, UnitedHealthcare will only remain in the state exchanges of Virginia, New York, and Nevada. It is exiting a large majority of its market, leaving 31 states.
Meanwhile, a handful of other carriers are exiting just one or two states, so keep an eye on yours to determine if your insurance will need to change.
Alaska – Moda
Arizona – Health Choice
Connecticut – HealthyCT
Georgia – Cigna
Indiana – Physicians Health Plan, Southeastern Indiana Health Organization
Kansas – Blue Cross Blue Shield of Kansas
Kentucky – WellCare
Michigan – Priority Health Insurance Company
Nebraska – Blue Cross Blue Shield of Nebraska
New Jersey – Oscar
New Mexico – Presbyterian Health Plan
New York – WellCare
Ohio – InHealth Mutual
Oregon – Lifewise Health Insurance
Texas – Scott & White Health Plan
Washington State – Health Alliance Northwest
Wisconsin – Ambetter
It’s normal to see transitions each year in participating health insurance carriers across the states. However, this year’s activity is leaving almost two million individuals without coverage for 2017. While this is not the largest transition we’ve seen (2013 saw more people lose insurance for compatibility reasons during early transitions to the ACA), this is certainly very significant. If you are affected by any of these withdrawals, it’s time to start thinking about your health coverage for 2017. Depending on where you live, there are different options available to you and your family.
Well…What Do I Do Now?
If you are one of the hundreds of thousands of Americans who will need to find a different carrier for 2017, there are options available. But for some states, and particularly within rural counties, there may be fewer choices – even as low as just one available carrier. For these counties and states, it’s incredibly important to keep a close watch on that existing carrier. So far, there’s already been one situation where there are no available carriers at all already threatening an Arizona county. In scenarios like this, the state government needs to jockey for new carriers to enter their exchanges.
If you see your state or your plan listed above (or even if you don’t), it’s important to look carefully at the withdrawal before throwing it all to the wind. For example, Blue Cross Blue Shield of Arizona is remaining in the state but exiting certain counties. Other variations of this could be that you’re losing your existing coverage, but your carrier still offers different types of plans. For example, Blue Cross Blue Shield of Minnesota only offering HMO plans, and discontinuing PPOs for 2017. But throughout all of this decision making, it’s important to keep in mind that “shopping around” is never a bad idea, as changes year after year could very well mean you could be finding a better price elsewhere.
In some cases, you may be automatically renewed into a different plan though a process called “Mapping.” This protocol helps to minimize the number of people who wake up on January 1 with no health coverage at all. However, this process can switch you to a different carrier altogether. For example, if you are a policyholder for a UnitedHealthcare plan in an exchange, you could be moved to a new carrier automatically if you are a subscriber in an exit state. To control your health insurance provider (and cost), it’s important to be aware of mapping and how it may affect you moving into 2017.
Let’s talk about what to do if you need to find a new plan. Comparing carriers whenever possible is an important part of finding the most affordable plan. In addition, when shopping for a new insurance plan, keep your current doctors in mind. Not all insurance plans offer coverage for all doctors, meaning that if you have the choice between a few different carriers, your favorite physicians could play a big role in your decision.
Pay attention to deadlines. If you’re shopping for a new plan, open enrollment for 2017 starts on November 1. The enrollment period officially closes on January 31, 2017, but there are cases in which you may need to pick by December 15, 2016.
Particularly for U.S. health insurance, it’s a smart move to look to the experts when shopping around for insurance plans. Fortunately, another option for finding the right plan is to go through a Licensed Insurance Agent, who is versed in all the legal and regularity facets of health insurance.
What is a Licensed Insurance Agent?
Working with a Licensed Insurance Agent can help individuals and families find new coverage or lower the cost of their health insurance payments through years of training and expertise. Each state requires agents to undergo rigorous licensure training to sell insurance. For health insurance, a licensed agent can help you lower payments through their knowledge of existing tax subsidies and credits, provider choices, and local regulatory requirements. Many times, they can work with you to achieve enrollment year-round, even outside the official enrollment period, for qualifying individuals.
Much like tax professionals, insurance agents are there to help make your life simpler. From finding and applying for coverage, to navigating your state’s regulatory requirements, to unearthing tax credits and subsidies to drive your costs down, agents can be an invaluable resource to navigate any health insurance woes – especially in today’s turbulent and complex market.
Insurance can be daunting, but it doesn’t have to be. You deserve simple and effective health coverage for yourself and your family, and by working with a Licensed Insurance agent, you can make this a reality. Our expert agents take the guesswork out of navigating both state and federal insurance changes to get you the best and most affordable insurance coverage possible.
We’ve helped tens of thousands of Americans get covered at prices they can afford, sometimes saving individuals and families hundreds each month. There is no fee for service with our licensed Health Insurance Marketplace Agents, and we’re prepared to help you through the process of getting covered from start to finish. Contact us to learn more today, and discover the plan that’s right for you.