Federal officials confident in Obamacare exchanges despite lack of choices
Posted August 24, 2016
Raleigh, N.C. — Federal health insurance officials touted figures Wednesday that show health insurance would cost less than $75 per month for three-quarters of all North Carolina consumers who purchase coverage though the HealthCare.gov marketplace, despite a lack of consumer choice among insurers that they described as a "key" consumer protection.
Department of Health and Human Services officials touted a report Wednesday that shows 82 percent of consumers shopping on the exchange in the state would likely see the premiums they pay go up by a maximum of $4 per month even if insurers raise rates by as much as 25 percent.
That's due to what Kathryn Martin, an acting assistant secretary, described as "two key Affordable Care Act protections." One of those is tax credits that ratchet up along with sticker price of insurance plans. The other protection she touted was consumer choice – the ability of consumers to shop around.
"We know that shopping around during open enrollment plays a very important role for consumers," Martin said during a conference call with reporters.
However, Blue Cross Blue Shield of North Carolina is the only carrier that has notified the state Department of Insurance it will provide coverage throughout the state next year. Cigna says it will offer Affordable Care Act policies in the Raleigh market starting in 2017. Aetna, which had initially indicated in would offer policies in parts of the state, recently announced it would pull out of North Carolina and several other states.
Several reporters on the call questioned officials about the conflict between choice being a consumer protection and the lack of choice consumers in many states will experience in 2017.
"I think it's important to step back and remembers what the health insurance market in the individual market was like before the Affordable Care Act, where folks with pre-existing conditions had no options," said Dr. Mandy Cohen, chief of staff for the Centers on Medicare and Medicaid Services.
Cohen and Martin were pressed several times about the lack of options on the exchanges, particularly in rural areas. They insisted that the rates of uninsured people were still going down and that people could still find affordable coverage.
"Entry and exit from the market is a normal part of the marketplace," Cohen said.
Brendan Riley, a health policy analyst with the liberal-leaning North Carolina Justice Center's Health Advocacy Project, points out that, just because many consumers won't have a choice of insurers on the exchange, doesn't mean they won't have a choice of plans.
At a minimum, he said, Blue Cross Blue Shield will offer different levels of plans with varying premiums and deductibles, and it's possible the insurer will offer different plans at each of those levels.
"There is some element of choice, but it may not be the same element of choice you would have with competition from other insurance carriers," Riley said.
Blue Cross has already said it plans to drop its top-of-the-line "platinum" plans next year, which account for only 3 percent of its ACA coverage.
Riley agreed with the federal officials who said that tax subsidies offered to those shopping on the exchange would be key. For the current year, he said, 91.5 percent of consumers on the exchange received some sort of subsidy.