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Insurers file multiple scenarios for 2018 ACA premium rates due to uncertainty over CSRs, individual mandate

Insurers assuming CSRs will end have factored in rate increases of an additional 2 to 23 percent, says a Kaiser Family Foundation report.

Susan Morse, Managing Editor

Insurers in 20 states and the District of Columbia have filed premium rate requests for the federal exchange ahead of an August 16 deadline, many on the assumption that cost-sharing reduction payments will not be paid and that the individual mandate will either not be enforced or weakly enforced, according to a Kaiser Family Foundation report released Thursday.

Insurers that have assumed CSRs will end have factored in rate increases of an additional 2 to 23 percent, the report said. Kaiser estimates that silver premiums would have to increase by 19 percent on average to compensate for the loss of CSR payments.

The average rate request is double digits, ranging from lows of 13.1 percent and 13.8 percent from Moda Health in Oregon and the Blue Care Network in Michigan, respectively, to highs of 54.3 percent for CareFirst GHMSI in Virginia, 49.2 percent for CHRISTUS Health Plan in New Mexico and 45.6 percent from PacificSource Health Plans in Idaho and CareFirst BlueChoice in Maryland.

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[Also: Pennsylvania premium rates below 9% for individual market if Trump administration keeps market stable]

Insurers are building uncertainty in their rates, filing under multiple scenarios involving CSRs and the individual mandate. President Trump has threatened to end the CSR subsidies and has used Twitter to urge Senate Majority Leader Mitch McConnell to get back to Washington to repeal and replace Obamacare.

Straight repeal would end the CSRs and the individual and employer mandates.

[Also: Skinny repeal fails as McCain defects in dramatic early-morning vote]

Also affecting rates is the return of the health insurance tax, which is adding about 3 percent to premiums in 2018.

States such as California have asked insurers to submit two sets of rates to account for the possibility of the end of CSRs. California would add a 12.4 percent surcharge, on average, across 11 carriers, should CSRs be eliminated.

Other insurers state that if they do not get clarity by August 16 they may either increase their premiums further or withdraw from the market, the Kaiser report said.

Across 20 states and D.C., an average of 4.6 insurers have indicated they intend to participate in 2018, compared to an average of 5.1 insurers per state in 2017, 6.2 in 2016, 6.7 in 2015, and 5.7 in 2014.

Most states report double digit premium increase requests for the second lowest cost silver plan, ranging around 12 to 18 percent. These include California, 12 percent, Colorado, 12 percent, Connecticut, 13 percent, Indiana, 18 percent, Maine 17 percent, and Oregon, 12 percent.

On the higher end are Delaware, at 49 percent, Idaho at 27percent, Maryland, 25 percent, New Mexico, 34 percent, Pennsylvania, 23 percent, Tennessee 21 percent, Virginia 33 percent and Washington, 29 percent.

On the low end for premium requests are the District of Columbia at 9 percent, Georgia, 7 percent, Michigan, 3 percent, Minnesota 5 percent, New York 10 percent, Rhode Island, a negative 5 percent, and Vermont, zero percent.

The premium rate requests for Michigan and California both assume CSR payments will continue.

[Also: Lack of CSRs one reason Anthem BCBS to leave ACA market in Ohio]

Of major cities, the steepest proposed increases in the unsubsidized second-lowest silver plan are in Wilmington, Delaware, up 49 percent from $423 to $631 per month for a 40-year-old non-smoker;  Albuquerque, New Mexico, up 34 percent from $258 to $346, and Richmond, Virginia, up 33 percent from $296 to $394.

Meanwhile, unsubsidized premiums for the second-lowest silver premiums will decrease by 5 percent in Providence, Rhode Island,  from $261 to $248 for a 40-year-old non-smoker and remain essentially unchanged in Burlington, Vermont, $492 to $491.

By state and insurer, the average rate increase requested is:
Connecticut: ConnectiCare, 17.5 percent
Delaware: Highmark, BCBSD, 33.6 percent
Georgia: Alliant Health Plans, 34.5 percent
Idaho: Mountain Health Co-op, 25 percent; PacificSource Health Plans, 45.6 percent; SelectHealth, 45 percent
Maryland: CareFirst BlueChoice, 45.6 percent
Maine: Harvard Pilgrim Health Care, 39.7 percent
Michigan, BCBS of Michigan, 26.9 percent; Blue Care Network of Michigan, 13.8 percent; Molina Healthcare, 19.3 percent
New Mexico: CHRISTUS Health Plan, 49.2 percent; Molina, 21.2 percent, New Mexico Health Connections, 32.8 percent
Oregon: BridgeSpan, 17.2 percent, Moda Health, 13.1 percent, Providence Health Plan, 20.7 percent
Tennessee: BCBS of Tennessee, 21.4 percent, Cigna, 42.1 percent, Oscar Insurance, new to state so figures N/A
Virginia: CareFirst BlueChoice, 21.5 percent; CareFirst GHMSI, 54.3 percent
Washington: LifeWise Health Plan of Washington, 21.6 percent, Premera Blue Cross, 27.7 percent, Molina, 38.5 percent.

The deadline for insurers to sign a contract to use is Wednesday, Sept. 27.

While double digit rate hikes have been touted as a failure of the ACA to provide affordable coverage, Kaiser said a look back to premium increases to 2014 shows relatively modest single-digit increases in the major cities studied.

Indianapolis has a 1 percent drop and Providence, Rhode Island, a four percent decline in rates since 2014. The highest increases were reported in Minneapolis and Nashville, at 24 and 28 percent, respectively.

About 71 percent of marketplace enrollees are in silver plans. About 84 percent receive a tax credit to lower their premium cost. Tax credits rise with an increase in benchmark premiums.

For instance in California, the cost of the second lowest cost silver plan before the tax credit for 2018 is $289, up from $258 in 2017.  But with a tax credit, a 40-year old non-smoker making $30,000 a year would pay $201 a month in 2018, down from $207 in 2017, because the premium tax credit would rise from $51 to $88.

Twitter: @SusanJMorse