Obamacare Market Shoppers Will Have Fewer Options

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The Affordable Care Act health insurance market in Oklahoma faces big changes next year, with the dominant company moving 40,000 people into different plans and three other companies dropping out entirely.

On Jan. 1, Oklahoma will be left with only two companies offering individual health plans in the “Obamacare” market: Blue Cross Blue Shield of Oklahoma, the existing market leader, and UnitedHealthcare, a new entry.

The U.S. Centers for Medicare and Medicaid Services is expected to announce the new insurer lineup in Oklahoma within days. Online “window shopping” will begin on Oct. 18. Open enrollment will begin Nov. 1.

Among the specific changes:

> Blue Cross said it has begun notifying about 40,000 Oklahomans that it will no longer offer the “Blue Choice” provider network to individuals. Existing policyholders will be shifted into similar policies in one of two other networks: “Blue Preferred” or “Blue Advantage.” Both have fewer participating doctors, hospitals and other providers. Blue Cross will continue to offer the Choice network to employers with group plans.

> CommunityCare of Oklahoma, a Tulsa company offering health maintenance organization plans, has notified the federal government that it plans to drop out of the Affordable Care Act market. CommunityCare did not respond to a request for comment, but a state official said fewer than 2,000 people would be affected.

> GlobalHealth, another Tulsa-based HMO insurer, said it had already notified about 1,200 Oklahomans that it was leaving the Affordable Care Act market. A company official promised “a smooth and orderly transition” for its members and agents.

-Assurant Health, a Wisconsin company, is leaving the individual health insurance market nationwide. A company spokeswoman said the change would affect 885 Oklahoma policies, of which 153 were sold on the Affordable Care Act exchange.

-UnitedHealthcare, the new participant in Oklahoma’s Affordable Care Act market, has not announced details of the plans it will offer. But a state official said its rates would be “competitive” with those offered by Blue Cross, which is seeking a 31 percent average rate increase for 2016.

Mike Rhoads, deputy commissioner of the Oklahoma Insurance Department, said the changes reflected a continuing shakeout in the Affordable Care Act marketplace as insurance companies prepared for the third year of coverage.

The Affordable Care Act set up health insurance markets in all 50 states to provide federally subsidized coverage to low and middle-income people who could not obtain affordable insurance through their employers.

About 126,000 Oklahomans have obtained subsidized insurance through the marketplace, which is operated by the federal government because Oklahoma refused to set up a state-run market.

Rhoads said most companies lost money in Oklahoma’s market in 2014, and probably would do so again in 2015, despite an initial round of rate increases and the expectation of a second round in 2016.

“Whenever that happens to a business, you’ve got to make some changes,” Rhoads said. “They’ve made those changes going into 2016.”

A spokesman for the U.S. Centers for Medicare and Medicaid Services in Dallas said the agency could not discuss 2016 changes until later this month.

Letters sent recently to Blue Cross Choice policyholders state in bold print: “Your current Blue Cross and Blue Shield plan will be discontinued on Dec. 31, 2015. But you have other options.”

Company spokeswoman Ashley Hudgeons in Tulsa said about 40,000 Blue Cross members were affected by the company’s decision to stop offering the Choice provider network to individuals. That represented about 20 percent of Blue Cross’ individual customer base in Oklahoma, she said. The other 80 percent are already enrolled in the Preferred and Advantage networks.

Hudgeons said she could not immediately determine the numbers of providers participating in each of the networks. She said affected customers would be transferred into similar plans in the other networks, but acknowledged that those networks offered fewer providers than Choice did.

The Preferred network has providers in all 77 counties who have accepted lower reimbursements than those who participate in the Choice network. The Advantage network is available in 52 counties, but is concentrated in the Tulsa and Oklahoma City metro areas. Its reimbursement rates are even lower.

“We plan to offer consumers the most affordable plans that give as wide a selection of doctors and hospitals as possible,” Hudgeons said in an email. “We will automatically transition impacted members to a comparable plan, and members have the choice to choose a different plan, or different carrier, based on what’s best for themselves and their families.”

In an interview, Hudgeons said Blue Cross had determined that it could no longer operate the Choice network for individuals without seeking unsustainably high rate increases.

Earlier this year, the company filed documents with the federal government saying it would need a 31 percent across-the-board rate increase to continue operating its existing networks in Oklahoma.

The federal government has not yet announced approved rates for 2016. Even if the rate increase is approved, the premiums paid by many individual policyholders would not necessarily rise that much, because they receive federal subsidies.

GlobalHealth, the Tulsa-based HMO insurer that wants out of the market entirely, cited similar cost and rate concerns.

GlobalHealth Senior Vice President John Wiscaver said the company remained committed to improving its members’ health and serving their communities.

“However, we can’t accomplish these goals and continue to participate in the national, federally-facilitated marketplace in its current form,” Wiscaver said in an emailed statement.

“Our evaluation of the (Affordable Care Act) exchange predicts further rate volatility and a trajectory of unsustainable premium increases … together with the growing complexity in requirements and the ever-changing regulations,” Wiscaver said.

Rhoads, the Oklahoma Insurance Department official, said Blue Cross’ decision to restrict its Choice network was a “major event” for Oklahoma’s market.

“It places higher volumes in smaller networks,” Rhoads said. “While they’ve got coverage in all the primary care and specialist categories, there will be perhaps fewer (providers).”

  • I enrolled with a major carrier through the Affordable Care Act for the few months I was eligible before turning 65 . It was with the same insurance company I had used for 20 years when employed with small nonprofits. I was shocked with the level of service provided. They did not act as they had the 20 years before and it felt like I had purchased a much lower quality of product. The only difference with me was working at a different nonprofit that did not qualify for group rates. I have begun looking into renewal options with Medicare Part D and supplemental coverage for 2016 and discovered my plan was no longer available and I was shifted to an option which was over 40% higher. Upon investigation, I learned that another option with equivalent coverage was available for a 30% increase. I was asked by the Part D carrier why I had chosen the plan I had been on for two years because a less expensive option was available with no change in actual benefits.
    The carrier representative could not tell my why I was not advised that less expensive options were available in any of the instances I brought to her attention.
    My question: Is there anyone who can inform the consumers about the “truth about the numbers”? What profit margins are the carriers requiring before they will provide the good people of Oklahoma health care they need? It would be nice to really know the truth. How many representatives and senators in the Oklahoma Legislature are also executives or agency owners also representing large insurance companies?