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Don’t Count on Lower Premiums Despite Pandemic-Driven Boon for Insurers



When COVID-19 smacked the United States in March and April, health plans feared medical costs could skyrocket, jacking up premiums drastically in 2021, when millions of the newly unemployed might still be out of work.

But something else happened: Non-COVID care collapsed as hospitals emptied beds and shut down operating rooms to prepare for an expected onslaught of patients sickened by the coronavirus, while fear of contracting it kept people away from ERs, doctors’ offices and outpatient clinics. In many regions of the country, the onslaught did not come, and the billions of dollars lost by hospitals and physicians constituted huge savings for health plans, fattening their bottom lines.

But that doesn’t mean consumers will see lower premiums next year.

Numerous insurers across the country have announced plans to hike rates next year, though some have proposed cuts.

Peter Lee, executive director of Covered California, appeared skeptical about premium reductions in the state’s Affordable Care Act exchange, which is likely to announce 2021 health plan rates next week.

“Would we like zero increases? Absolutely. Would we like them negative? Yeah — but not if that means you’re going to increase premiums in a year by 20%,” Lee said in an interview with California Healthline this week. “We’ve been leaning on them to do what we always lean on them to do, and this is to have the lowest possible rates where you won’t be on a rate roller coaster. We want health plans to price right — not to price artificially low or artificially high.”

Covered California provides coverage for about 1.5 million residents who buy their own insurance.

If the insurance exchanges in other states offer any guidance for Covered California, it is in the direction of moderate premium increases for 2021, though there is wide variation.

A KFF analysis last week of proposed 2021 rates in the exchanges of 10 states and the District of Columbia showed a median increase of 2.4%, with changes ranging from a hike of 31.8% by a health plan in New Mexico to a cut of 12% in Maryland. (Kaiser Health News, which produces California Healthline, is an editorially independent program of KFF.)

Among the roughly one-third of filings that stated how much COVID-19 added to premiums, the median was 2%, with estimates ranging from minus 1.2% at a plan in Maine to 8.6% at one in Michigan.

The proposed premiums for ACA marketplace plans do not affect job-based coverage, but they may indicate how the pandemic is affecting premiums generally.

The consensus among industry experts is that COVID-19 has generated little pressure for rate rises, and health plans should err on the side of moderation. But some fear that many insurers will hold onto the reserves they’ve built up, citing the possibility of widespread vaccinations and concerns that the care forgone in 2020 could rebound with a vengeance next year.

“The tendency of health plans, when they are faced with any degree of uncertainty, is to be very conservative and price for the worst-case scenario,” said Michael Johnson, an industry observer and critic who worked as an executive at Blue Shield of California from 2003 to 2015. “Actuaries are less likely to get fired if the plan prices too high than if the plan prices too low. But I think regulators really need to push back hard on that.”

Lee said all 11 insurers participating in the exchange this year will remain in 2021, and no new ones will be added to the mix, though some of the current carriers will extend their coverage geographically. Ninety percent of consumers who buy their own health insurance get subsidies from the federal government or the state to help pay their premiums.

In January, California became the first state to offer subsidies to middle-income people who make too much money to qualify for federal subsidies. The lion’s share of the state subsidies is earmarked for those who earn between 400% and 600% of the federal poverty level, or $51,040 to $76,560 a year for an individual and $104,800 to $157,200 for a family of four.

The rate proposals expected to be unveiled next week will be subject to scrutiny by state regulators before they are finalized. Sign-ups for the plans start Nov. 1 and run through Jan. 31. This year, the average Covered California rate increase statewide was 0.8%, the lowest since the exchange started providing coverage in 2014.

The benefits reaped by health plans so far in the pandemic can be seen in strong second-quarter earnings and reduced spending on care. UnitedHealth Group, the nation’s largest health insurer, announced earlier this month that its net profit in the April-June quarter nearly doubled from the same period a year earlier. Its medical spending plummeted from 83.1% of premium revenue to 70.2% over that period.

Anthem, the parent company of Blue Cross of California, reported Wednesday that its net profit in the second quarter doubled from the same period in 2019, also on the back of plunging medical expenses.

Anthem said it offered one-month premium credits ranging from 10% to 50% to enrollees in individual, employer and group dental policies — including its Blue Cross plans in California.

UnitedHealth said it has provided $1.5 billion worth of financial support to consumers so far, including premium credits and cost-sharing waivers, and expects to pay out $1 billion in rebates.

But UnitedHealth, which does not participate in Covered California, is seeking a rate increase of 13.8% in the New York exchange. Anthem, which covers about 80,000 people in Covered California, is planning rate hikes of 16.6% in Kentucky and 9.9% in Connecticut.

On the other hand, Kaiser Permanente, which covers more than one-third of Covered California enrollees, plans rate cuts in other states, ranging from 1% in Hawaii to 11% in Maryland. (Kaiser Health News, which produces California Healthline, is not affiliated with Kaiser Permanente.)

Lee downplayed the notion of a financial boon for California health plans, saying that, partly because of the use of telehealth, primary care has rebounded and the plans are paying for it. “So we don’t see this as being at this point a bonanza year for health plans,” he said. “Rather, it’s a year in which there are lessons learned for how we can deliver care in a pandemic.”

Still, the health plans are in a far stronger position than they had feared earlier this year.

In March, Covered California released a study showing that COVID-19’s impact on 2021 premiums for individuals and employers could range from an increase of 4% to more than 40%. But less than three months later, projections commissioned by the industry’s national advocacy group, America’s Health Insurance Plans, showed that even in the worst-case scenario of a 60% COVID infection rate — far above where it stands now — the pandemic would increase medical costs in 2020 and 2021 by 6% at most, and could even decrease them.

That moderate effect is largely attributable to what Katherine Hempstead, a senior policy adviser at the Robert Wood Johnson Foundation, called “a kind of yin and yang: If you have a lot of COVID, you don’t have a lot of other health care spending.”

Independent of the course the pandemic takes, emergency room and outpatient visits still lag behind pre-COVID levels and will probably continue to do so next year, to the continued benefit of insurers, predicted Glenn Melnick, a professor of health care finance at the University of Southern California’s Sol Price School of Public Policy. That could be good news for consumers, he said, potentially leading to lower premium increases or even reductions next year.

On the other hand, hospitals and doctors have lost money, and the ones whose contracts with health plans are up for renewal will be looking to make up those losses, Melnick said.

“Providers could be asking for 20-25% increases next year,” he said, “and if they’ve got market power, they can make it stick.”

This KHN story first published on California Healthline, a service of the California Health Care Foundation.

Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation which is not affiliated with Kaiser Permanente.


By: Bernard J. Wolfson
Title: Don’t Count on Lower Premiums Despite Pandemic-Driven Boon for Insurers
Sourced From:
Published Date: Fri, 31 Jul 2020 09:00:29 +0000

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Covered California anuncia una baja récord en las primas para 2021



Las primas para los planes de salud vendidos a través de Covered California, el mercado de seguros establecido por la Ley de Cuidado de Salud a Bajo Precio (ACA), aumentarán un promedio de 0.6% el próximo año, el incremento más bajo desde que comenzó a ofrecer seguros de salud en 2014, dijo la agencia.

El aumento modesto le sigue a un incremento promedio a nivel estatal de 0.8% en la cobertura que comenzó en enero de este añ, que también marcó un récord por lo bajo.

Los cambios en las tasas variarán según las regiones, desde un aumento promedio de 5.6% en el condado de Santa Clara hasta reducciones de 2.1% en el suroeste del condado de Los Ángeles, y 2.6% en los condados de Imperial, Inyo y Mono.

Antes del anuncio, algunos observadores de la industria habían pedido recortes de tasas, ya que este año se ha gastado mucho menos en atención médica regular.

En la primavera, se cancelaron las cirugías electivas por la pandemia de COVID-19 y se han estado reduciendo dramáticamente las citas médicas, y a salas de emergencias y clínicas ambulatorias.

Sin embargo, Peter Lee, director ejecutivo de Covered California, dijo que las compañías de seguros del mercado “están viendo cómo recuperan sus costos de atención médica y están proyectando que en lo que queda del año se pondrán al día con los gastos de salud que pensaron que iban a tener en 2020”, dijo Lee.

Los planes de salud en el mercado habían proyectado aumentos en los costos médicos no relacionados con COVID de 4% a 8% el próximo año y no pensaron que necesitarían un presupuesto adicional para la pandemia, explicó.

El incremento de la tasas ha sido modesto principalmente debido a un aumento de nuevos afiliados “más saludables” tanto durante el período de inscripción regular para la cobertura de 2020 como el período especial de inscripción actual, recientemente extendido hasta el 31 de agosto, para las personas cuya cobertura se ha visto afectada por la pandemia, dijo Lee.

Covered California dijo que un análisis del riesgo médico y la demografía de estos recién llegados mostró que “son más saludables en promedio que las cohortes equivalentes de 2019”.

Otros factores, dijo, incluyen la derogación de un impuesto federal sobre los planes de salud, que redujo las primas de 2021 en un promedio de 1.7%, y un recorte el próximo año en la tarifa de “participación” que los planes de salud pagan a Covered California, del 3.5% a 3.25% de las primas.

Covered California brinda cobertura a aproximadamente 1.5 millones de californianos que compran su propio seguro. Alrededor del 90% de ellos reciben asistencia financiera del gobierno federal o estatal, o de ambos, para ayudar a pagar sus primas. Los planes en el mercado son semejantes a los del mercado abierto, donde las personas compran seguros sin asistencia financiera.

Algunos expertos en sistemas de salud creen que las aseguradoras continuarán gastando menos en atención médica el próximo año.

Glenn Melnick, profesor de finanzas públicas en la Escuela de Políticas Públicas Sol Price de la Universidad del Sur de California, dijo que los hospitales, especialmente en la sala de emergencias y las visitas ambulatorias, aún no llegan a tener un volúmen de pacientes y procedimientos como tenían antes de COVID y podrían continuar así hasta que haya una vacuna disponible.

Michael Johnson, un analista de la industria de seguros de salud que trabajó como ejecutivo en Blue Shield of California de 2003 a 2015, opinó que “los reguladores deberían estar obligando a estos planes a justificar por qué no están reduciendo las tasas, dado el efecto que hemos visto que la pandemia está teniendo hasta ahora”.

El aumento promedio en todo el estado entre los operadores de Covered California es menor que lo que se ha propuesto en muchos otros estados.

Un análisis de KFF de julio de las tasas propuestas para 2021 en los mercados de 10 estados y el Distrito de Columbia mostró un aumento promedio del 2.4%, con cambios que van desde un aumento del 31.8% por un plan de salud en Nuevo México hasta un recorte del 12% por uno en Maryland.

Los anuncios de tarifas de este año se producen cuando ACA sigue amenazada por una demanda federal presentada por funcionarios republicanos de 18 estados, junto con la administración Trump, con la meta de revocar la ley.

De ganar la demanda, más de 20 millones de personas podrían perder su cobertura de salud y se podrían eliminar las protecciones populares para el consumidor que brinda ACA, incluida la prohibición de discriminar o cobrar más a las personas con condiciones preexistentes como hipertensión o diabetes.

La Corte Suprema planea escuchar el caso en el otoño.

Las 11 compañías de seguros que operan en Covered California este año permanecerán en 2021, y no entrarán nuevas en el mercado. Pero Anthem Blue Cross y Oscar Health Insurance expandirán sus ofertas geográficamente, según informó el mercado.

Anthem ingresará a los condados de Inyo, Kern, Mono y Orange. Oscar se unirá a la competencia en el condado de San Mateo. Muchos de los planes de salud de Covered California están disponibles solo en ciertas regiones.

Kaiser Permanente es el mayor operador en Covered California, con cerca de 526,000 afiliados este año, más de un tercio del total. A Kaiser le sigue Blue Shield of California, con 392,000, y Health Net, con 232,000.

Las tarifas difieren no solo de un operador a otro y de una región a otra, sino también según la edad de la persona cubierta. Las primas también difieren según el nivel de beneficios, desde el nivel de cobertura “bronce” más barato hasta el más alto, conocido como “platino”.

Cuanto menor sea la prima, mayores serán los deducibles y los pagos de coseguro por la atención.

El deducible individual para el nivel de bronce en 2021 se establece en $6,300. Para el nivel de plata, el segundo nivel de cobertura más barato, el deducible individual completo en 2021 será de $4,000, también. Pero muchos afiliados en el nivel de plata están en planes que ofrecen ayuda financiera para reducir su parte de los costos médicos, y eso puede hacer que el deducible para 2021 baje a $75.

Además, numerosos servicios médicos no están sujetos al deducible en los planes de plata, incluidas la atención primaria y visitas a especialistas, análisis de laboratorio, radiografías y otros. En los planes de bronce, las primeras tres visitas de atención primaria no están sujetas al deducible.

Covered California dijo que, en promedio, los beneficiarios del mercado que planean renovar para 2021 pueden ahorrar un 7.3% en las primas al cambiar al plan menos costoso en el mismo nivel de cobertura.

Las tarifas de 2021 están sujetas a una revisión final por parte del Departamento de Atención Médica Administrada y el Departamento de Seguros del estado, pero es poco probable que ocurran cambios significativos.

El período de inscripción para la cobertura 2021 comienza el 1 de noviembre y se extiende hasta el 31 de enero.

Esta historia de KHN fue publicada primero por California Healthline, un servicio de la California Health Care Foundation.

Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation which is not affiliated with Kaiser Permanente.


This story can be republished for free (details).


By: Bernard J. Wolfson
Title: Covered California anuncia una baja récord en las primas para 2021
Sourced From:
Published Date: Tue, 04 Aug 2020 06:51:53 +0000

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Missouri Voters Approve Medicaid Expansion Despite GOP Resistance



Despite strong opposition from Republicans and rural voters, Missouri on Tuesday joined 37 states and the District of Columbia in expanding its Medicaid program. Voters in Missouri approved creating a state constitutional amendment that will open Medicaid eligibility to include healthy adults starting July 1, 2021.

Voters approved expansion by a margin of 6.5 percentage points.

Missouri joins five other mostly conservative states that have passed Medicaid expansion via ballot initiatives — most recently, Oklahoma, on June 30. Most of the remaining 12 states that have not expanded Medicaid are Republican-leaning states in the South.

Nika Cotton, owner of Soulcentricitea, a new tea shop in Kansas City, Missouri, woke to the news on Wednesday morning. Cotton, whose children are 8 and 10, said she will qualify for health care coverage under the expansion.

“It takes a lot of stress off of my shoulders with having to think about how I’m going to take care of myself, how I’m going to be able to go and see a doctor and get the health care I need while I’m starting my business,” Cotton said.

Medicaid expansion, which states have the option of adopting as part of the Affordable Care Act, extends eligibility in the program to individuals and families with incomes up to 138% of the federal poverty level. A family of three, like Cotton’s, could make up to $29,974 to qualify.

The federal government pays for 90% of expansion costs.

As of 2018, 9.3% of Missourians were uninsured. And in 2019, researchers from Washington University in St. Louis estimated that around 230,000 people in Missouri would enroll for Medicaid if it were expanded. The study also showed expansion would save the state an estimated $39 million a year, largely by eliminating the need for other state health spending.

Missouri’s adoption of expansion follows a trend of increasing support in largely Republican states, according to health policy expert Rachel Nuzum of the Commonwealth Fund.

“What we’ve seen in our surveys over the years is when you take the labels off of the policies, when you take the Affordable Care Act label off, when you take Medicaid expansion off, and just start asking people whether or not you think low-income families should have access to Medicaid coverage, the support is overwhelming,” Nuzum said.

Support for expansion came largely from voters in and around Missouri’s urban centers such as Kansas City, St. Louis, Springfield and Columbia. In Kansas City for example, 87.6% of voters backed the measure.

Amendment 2 was rejected overwhelmingly by conservative voters in the mostly rural parts of the state that have the highest uninsured and poverty rates. Voters in McDonald, Morgan and Scotland counties, which have the three highest uninsured rates in the state, rejected the measure by margins of nearly 2-to-1 or greater.

Expansion opponents warned that high enrollment in the program could lead to the state’s 10% share of the costs becoming a significant burden for Missouri, especially when state revenues are down.

“When state revenues fall, it begs the question, how are you going to pay for this?” said Ryan Johnson, in late July. He is a senior adviser for United for Missouri, a conservative policy advocacy organization.

“We’re concerned that they are going to have to raid public education,” he said, “and that’s a disservice to the kiddos who hope to go back to school this fall, the teachers, the administrators and everyone involved in the public education system.”

Responding to declining revenue related to the coronavirus, Missouri’s Republican governor, Mike Parson, recently reduced the 2021 budget by nearly $449 million, with education taking the hardest hit.

Health care experts have said that the economic effects of the pandemic, including high unemployment and lower state revenue, could strain the capacity of state Medicaid programs. However, health care advocates argue that expansion benefits individuals and families struggling as a result of the pandemic, and the influx of federal dollars and the jobs that result from expansion could help the economy.

“If we’re worried about the economy and we’re worried about people working, Medicaid expansion is actually a way to encourage people to work and not have that worry they’re going to lose health insurance for themselves or their families,” said Ryan Barker, vice president of strategic initiatives for Missouri Foundation for Health.

Republican state lawmakers have fiercely resisted Medicaid expansion. The expansion question was placed on the ballot after a petition.

Expansion advocates enlisted the Fairness Project, a Washington, D.C.-based campaigning organization, in developing and executing their campaign strategy. The Fairness Project has been involved in successful Medicaid expansion campaigns in other mostly conservative states, including Maine, Utah, Idaho, Nebraska and Oklahoma.

The “YES on 2” campaign was supported by a wide range of groups, including the Missouri Chamber of Commerce and Industry, the Missouri Hospital Association, the NAACP, the AFL-CIO and the AARP, among others. And, the coalition forged unlikely alliances, including Planned Parenthood supporters and Catholic Charities of St. Louis, which is operated by the Archdiocese of St. Louis.

YES on 2 campaign material made almost no mention of the Affordable Care Act, which has been unpopular in Missouri, and some of its flyers didn’t use the words “Medicaid expansion.”

Although support for the measure was much lower in conservative rural areas, Fairness Project executive director Jonathan Schleifer said Missouri’s expansion success relied on both activating progressive urban voters and engaging rural voters — though conservative resistance remained a significant obstacle to reforming health care policy.

“I think there’s still a lot of work to do to push back against the hundreds of millions of dollars, the public messages coming from as high as the White House, that there’s something wrong with the Affordable Care Act,” Schleifer said.

Opponents to expansion included Gov. Parson and other Republican lawmakers, Missouri Right to Life, Missouri Farm Bureau and Americans for Prosperity.

In the days leading up to the election, the “No on 2 in August” campaign sent a mailer suggesting that expansion would lead to an influx of undocumented immigrants seeking health care, but undocumented immigrants are not eligible for Medicaid and would not be under expansion, either.

The flyer, which featured a man in a medical mask emblazoned with the Mexican flag, read “Amendment 2 Means Illegal Immigrants Flooding Missouri Hospitals … While We Pay for It!”

The “No On 2 in August” campaign did not respond to requests for comment about the flyer.

Between serving customers on a busy morning on Wednesday, shop owner Cotton said her excitement about expansion was only slightly diminished by having to wait almost a year for it to take effect.

“It’s better late than never,” said Cotton. “The fact that it’s coming is better than nothing.”

This story is part of a partnership that includes KCUR, NPR and Kaiser Health News.

Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation which is not affiliated with Kaiser Permanente.


This story can be republished for free (details).


By: Alex Smith, KCUR
Title: Missouri Voters Approve Medicaid Expansion Despite GOP Resistance
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Published Date: Wed, 05 Aug 2020 18:40:33 +0000

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Reproductive health care coverage is shrinking due to widespread job losses



The post Reproductive health care coverage is shrinking due to widespread job losses appeared first on Live Insurance News.

The pandemic crisis job losses are especially hard on younger women and women of color.

The immediate economic harm from the COVID-19 pandemic crisis is clearer to see than issues such as shrinking access to reproductive health care coverage.

Young women and women of color are being hit hardest by job losses and therefore coverage loss.

Health plans are linked to employment for approximately half of Americans. This means that any of those 160 million people who lose their jobs also risk losing their health plans and, therefore, their reproductive health care coverage.

As job losses continue rising, a growing number of Americans are finding themselves uninsured. Many of these millions of people will be looking to publicly supported forms of health insurance such as the Children’s Health Insurance Program (CHIP), Medicaid, and government subsidized plans sold through the Affordable Care Act (ACA) exchanges.

This shift in the source of coverage can leave gaps in areas such as reproductive health care insurance.

According to the results of a recent Guttmacher Institute analysis, millions of people will suddenly find themselves uninsured or seeking new providers and programs that support that type of care. They pointed out that as publicly supported programs are asked to serve a rising number of people, they will also suffer broader logistical and financial pressures. These pressures will be piled onto the struggles that have already been building for years as family planning programs and clinics have weakened in the face of reproductive rights opponent political attacks.

The problems will be felt most acutely by the groups most at risk of job loss. Across the United States, young women and women of color are among those most affected. The National Women’s Law Center estimates that 56 percent of total job losses since March have been from women. This is believed to be because women are overrepresented in the types of employment most affected by lockdowns and stay at home orders, such as in restaurants, retail, and part-time, low-paid and tip-supported jobs.

As 13.9 percent of women were unemployed in May 2020 (compared to 11.6 percent of men), and as 16.5 percent of Black women, 19 percent of Latina women, 20.3 percent of women with disabilities and 24.0 percent of women aged 20 to 24 years were unemployed in that same month, these individuals also face losing their health plans and therefore their reproductive health care coverage.

The post Reproductive health care coverage is shrinking due to widespread job losses appeared first on Live Insurance News.


By: Nordstrom
Title: Reproductive health care coverage is shrinking due to widespread job losses
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Published Date: Wed, 05 Aug 2020 09:00:41 +0000

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