COLLINSVILLE-Right now, there are two health insurance companies, Aetna and Anthem, offering plans for Henry County residents on the Affordable Care Act exchange. In Patrick County, Anthem is the only one still operating on the exchange. Franklin County has three, with Sentara joining the other two. As of January 1, however, all of those companies will be leaving the exchanges entirely, creating a problem for individual residents who purchase health insurance on their own.
As of Tuesday, that added up to 66,576 people in 58 Virginia counties being at risk of not having a health insurance option come January. This only applies to those who purchase health insurance on their own. All three companies said that those who have insurance through their employer or anyone enrolled in “grandfathered” plans purchased before March 2010, Medicaid or Medicare would not be affected.
The three companies all released statements when they announced the decision to pull out of the exchange. In each one, they cited concern over federal discussions this summer to possibly eliminate the subsidies the companies receive, as well as a proposed tax on health insurers. As part of the Affordable Care Act, health insurance companies are given a yearly subsidy or “grant,” federal funding to reduce out-of-pocket costs for residents.
“Planning and pricing for ACA-compliant health plans has become increasingly difficult due to a shrinking and deteriorating individual market,” Anthem officials said last month in a statement. They added that other challenges included “continual changes and uncertainty in federal operations, rules and guidance, including cost sharing reduction subsidies and the restoration of taxes on fully insured coverage.”
What happens now?
Virginia Secretary of Health Dr. Bill Hazel said Tuesday that Washington had manufactured this crisis, which will affect about 70,000 of the 350,000 Virginians who purchase policies on the exchange.
“They are the ones who have to fix it,” he said. “Our hands are all but tied.”
Hazel said he has been meeting with Virginia insurers, but none is willing to reenter the market as long as federal cost-sharing reduction payments are at risk. The payments are subsidies to lower-income people to help cover out-of-pocket expenses of high deductibles, co-payments and coinsurance.
Without the subsidies, insurers say healthier individuals would be unable to afford to use insurance coverage and so would opt to go without, leaving the insurers to cover only the sickest and costliest individuals.
President Donald Trump has called the subsidies an insurance bailout, has threatened to cut them off and let the ACA collapse, and has decided on a monthly basis whether to continue the payments.
“My members are large organizations that work with long-term planning. They make decisions based on years, not months,” said Doug Gray, executive director of the Virginia Association of Health Plans.
Trump and Congressional Republicans this year failed in two attempts to replace the Affordable Care Act and have also failed to stabilize the market, Gray said.
“We didn’t get into this by accident. It was by a conscious choice of leadership,” he said.
Though insurers across the nation are facing the same destabilizing forces, it appeared as of this week that the collapse of the marketplace is only affecting parts of Virginia.
The latest map by the Centers for Medicare and Medicaid shows at least one insurer for every county in the nation, but a map by the Kaiser Family Foundation reflecting last week’s deadline, when Optima pulled out, shows parts of Virginia as the only places lacking any coverage.
The bureau and Hazel have been working with some small out-of-state plans that have expressed interest in picking up parts of the uncovered jurisdiction. But deadlines are approaching, as the Centers for Medicare and Medicaid have a Sept. 27 cutoff for insurers to participate in their programs for 2018. Open enrollment for individual plans starts Nov. 1 for policies that take effect Jan. 1.
The late date at which Anthem pulled out of the market has forced Virginia to scramble. Anthem provided the majority of the policies on the individual market.
“Some other places were dealing with this earlier. Anthem waited until the second week in August to announce. If we had known in April, we could have been working to bring small plans in,” Hazel said.
Hazel said that if Congress stabilizes the cost-sharing reduction payments, Anthem or other insurers might reenter the market, though deadlines would need to be extended.
Gray isn’t as hopeful. Insurers who leave the market are locked out for five years, he said. Anthem is the only national insurer that didn’t pull out entirely, having retained a couple small localities.
If other insurers wanted back in, Congress would have to allow an exception, he said.
Rep. Morgan Griffith blamed both the Affordable Care Act, and the Senate for failing to repeal and replace it, for the instability that prompted insurers to pull out of his district.
“In the face of Senate inability to act and to address the problem of insurers leaving the market, I am willing to work with my colleagues in Congress on both sides of the aisle to patch the collapsing system,” Griffith said. “To that end, I believe Congress must appropriate CSR [cost-sharing reduction] subsidies until such time as a true replacement for Obamacare can be implemented.”
Sen. Tim Kaine and Sen. Mark Warner said committees they serve on are also working on a fix.
Luanne Rife from the Roanoke Times contributed to this report