While individual premium proposals for 2016 are still pending, data from the ACA exchange markets offer a backdrop to next year's double digit increases.
Individual health plan premiums have varied quite a bit in the first two years of the new ACA market, but researchers at the Urban Institute have uncovered some notable themes amid the uncertainty.
National for-profit insurers entered many new state exchange markets for 2015 than in the first year--like United Healthcare--but their health plans "continue to reflect an aversion to risk by having higher than average premiums," found Linda Blumberg, John Holahan, and Erik Wengle, in a study of silver plan premiums in 73 rating areas across 30 states. As Aetna CFO Shawn Guertin put it, the hope is for the ACA exchange markets to be "modestly profitable" in the years to come.
Some regional insurers have entered exchanges with fairly high premiums, like Harvard Pilgrim's 2015 foray into Maine's individual market, selling the highest premiums in Portland ($364 silver plan) and in the rural rating region ($404). "Many (regional insurers) appear to be struggling to remain price competitive," argued Blumberg and colleagues.
In Seattle, Group Health sold the second-lowest priced plans in 2014 ($281) and the fourth-lowest out of 9 in 2015 (still $281). The nonprofit Community Health Plan of Washington was priced among the most expensive, with premiums of $335 and $343 in 2014 and 2015.
In about half of the markets studied, national insurers had the lowest- or second- lowest-cost silver plans in 2014. The next year, only about a quarter of them did, with most of 107 for-profit plans being relatively higher-priced. While their "participation is growing, they are generally not being aggressive in their pricing," Blumberg and colleagues wrote. "They seem content to compete on brand name and reputation for the time being."
Humana is an exception to the nationals' high pricing trend, although in Georgia Humana ended up losing money and attracting a lot of folks who needed a lot of healthcare.
In New York City, the start-up Oscar Health was largely pitted against the locally-strong EmblemHealth, with both selling lower-priced plans among 10 insurers. Oscar sold the third-most affordable plan in 2014 at $385 for a silver plan, then in 2015 with rates raised 2 percent sold the sixth-most affordable, out of 12 insurer. Emblem raised them 6 percent, while MVP Health Care, Fidelis Care, Health First, UnitedHealthcare and North Shore-LIJ offered lower rates.
Most of the Blues have kept exchange premiums relatively low, the study found, although some only sold in certain areas and Wellmark BCBS of Iowa and South Dakota has avoided the ACA exchanges altogether. In 2015, some increased prices and more hikes are expected for 2016 among the likes of BCBS of Tennessee, BCBS of North Carolina and others who attracted a large share of the new enrollees and have taken losses in the new plans.
Depending upon the nature of the market, Blumberg and her colleagues found, Blues insurers have taken very different pricing decisions. "Some Blue Cross Blue Shield insurers are monopolies or near monopolies"--in Alabama and to a lesser extent in New Mexico--and their offerings are "among the lowest premium plans in those areas." Elsewhere, in markets the Blues vie against national insurers, regional plans or cooperatives, they sometimes have priced "very aggressively" and in other markets with high premium plans garnering limited enrollment. Some, like the Cambia-Regence insurer, have launched subsidiaries with lower-priced, narrow network plans.
Another issuer of lower-priced, narrow network plans have been health system-sponsored insurers, such as Kaiser Permanente, INOVA Health System's Innovation plan, Providence Health & Services plan in Oregon and Sentara Healthcare's Optima Health in Virginia.
PreferredOne, a health plan owned by health systems in Minnesota, attracted 60 percent of state exchange enrollees in the first year with the lowest-priced plans, at $154 per month. The company bailed on the exchange market the next year, amid technology problems with the state marketplace and a surge of new members.
Also selling exchange plans in varied pricings have been North Shore-LIJ, Catholic Health Initiatives' QualChoice in Arkansas, Mercy Health's HealthSpan in Cincinnati, Ohio, and HealthPartners in Minnesota.
UPMC Health Plan started out with high priced plans in 2014, and then aimed to sell highly affordable products this year. In Pittsburgh, UPMC Health Plan silver plan premiums were the highest of three health insurers in 2014, at $288 per month, and then lowered 40 percent to $170, the most affordable of five insurers. In western Pennsylvania's rural rating area, UPMC Health Plan was the highest priced in 2014, at $320, almost $100 more than Geisinger Health Plan. In 2015, Geisinger increased rates 13 percent to $243, while UPMC lowered rates 32 percent to $228.