Open enrollment for Obamacare exchanges starts in just over one month, and in North Dakota the options just got worse.
Regional insurer Medica is pulling out of the state's health exchange for 2018 at the last minute, after state regulators denied the health insurer's request for a rate increase to account for uncertainty over funding for Obamacare cost-reduction subsidies.
North Dakota insurance commissioner Jon Godfread is concerned that there would be no easy way to reimburse consumers, if Congress approves funding for so-called cost-sharing reduction (CSR) subsidies at some point after enrollees begin paying premiums on their 2018 plans.
CSRs reduce out-of-pocket costs for low-income enrollees. Insurers are required to pay them, but Republicans in Congress have fought funding them, and the Trump administration has only agreed to pay them on a month to month basis.
"Although we understand Medica's concerns regarding the uncertainty of CSR funding, without knowing the intentions of Congress regarding CSRs, we had to make the decision to move forward with rates that assumed payments would be made," Godfread said in a statement. "If the Department approved rates requested by Medica excluding CSR payments, and Congress does fund those payments, it is unknown if the Department would then be able to reduce the rates to reflect the changes made."
Wednesday was the deadline for insurers to commit to offering plans on the exchanges for 2018. The Minnesota-based insurer will be offering exchange plans next year in its home state and four other Midwest states this year: Iowa, Kansas, Nebraska and Wisconsin. Regulators in other states have allowed carriers to price for the uncertainty over funding for CSRs.
"Medica could not be put in the position of being financially liable for the federal government's failure to fund CSRs," said Geoff Bartsh, Medica vice president for individual and family business. "We remain hopeful that if clarity can be provided by the federal government we, the (state insurance) department and CMS can quickly react and make the necessary changes so that Medica could be available as on option on the Exchange in North Dakota next year."
After Republicans in the Senate failed to garner enough votes this week to pass the Graham-Cassidy bill to repeal bill, Sens. Lamar Alexander, R-Tenn., and Patty Murray, D-Wash., said they will try to revive their bipartisan effort to approve funding for CSRs and stabilize the health insurance exchanges for the next two years. Health care lobby groups have continued to push officials toward reaching a bipartisan solution to shore up the exchanges, as they lobbied against the Senate repeal bill.
Medica provides coverage for about 3,000 North Dakota residents out of more than 20,000 exchange enrollees this year. Its departure will leave North Dakota with two insurers on the exchange for 2018, down from three this year. The state's Republican insurance commissioner bemoaned the failure of Congress to pass an Obamacare repeal bill.
"We were hopeful that Congress would come to a resolution regarding health care reform and that we would have more answers at this point. Unfortunately, that is not the case and because of that failure, Obamacare has continued to crumble," Godfread said. "Medica's decision further illustrates just how unstable the ACA Exchange is and will hopefully be a reminder to Congress that Obamacare is indeed in a death spiral. It is no longer sustainable and now North Dakotans are not only facing higher rates, but also fewer options."
Open enrollment for the exchanges begins on November 1, and runs through December 15 on states using the federal healthcare.gov site. Some individual states which run their own exchanges have extended the enrollment period into the new year.
Correction: North Dakota will have two insurers on the state's exchange next year; a previous version said it would only have one.