Half of Virginia’s counties now are on track to have no health insurers offering Obamacare plans in 2018 after an insurer reversed a decision to sell individual health coverage in much of the state.
The pullback by Optima Health in Virginia ends a brief, two-week period in which every county in the entire United States was projected at least one Obamacare insurer next year.
And it reflects ongoing uncertainty among insurers about the stability of the individual health plan market given the hostility of the Trump administration to Obamacare and other factors.
“The decisions we made were challenging ones given the recent changes and ambiguities in the marketplace,” said Michael Dudley, president and CEO of Optima Health.
The large insurers Anthem, Aetna and UnitedHealthcare had previously announced plans to leave Virginia’s Obamacare market altogether.
On Wednesday, Anthem, citing market volatility, said it would slash in half the number of counties in Kentucky where it will sell Obamacare plans in 2018.
Virginia’s Bureau of Insurance said 48 counties and 15 cities are now expected to be “bare” of Obamacare plans in 2018. About 350,000 people who currently have individual health plan coverage live in those areas, according to Sentara Healthcare, the non-profit health system parent of Optima Health.
Bureau spokesman Ken Schrad said there are several other counties that contain zip code areas that also are projected to lack an Obamacare plan option. The bare areas are rural, or have relatively low population density compared the rest of the state.
Optima Health will still sell individual health plans next year areas where it currently offers Obamacare coverage and where there are Sentara healthcare hospitals and physicians. The company also expects to significantly add to its current 17,000 individual plan customers because of the departure of larger insurers.
Asked if the department was confident it would be able to get another insurer to step into the bare counties, Schrad said, “I can’t make a prediction as to the success” of that effort.
“All I can say is the Bureau of Insurance is in serious discussions with carriers to see if the bare counties will have an option on the federal exchange in 2018,” Schrad said.
But Schrad noted that federal regulators had already pushed back the rate filing deadline once this year because of uncertainty in the individual health plan market.
“It’s a fluid situation,” he said.
Optima Health is also asking for very steep rate hikes next year, although the company noted that most of its customers receive federal Obamacare subsidies that will greatly limit the effect of those price increases.
About 70 percent of Optima Health customers “will have their increases mostly absorbed by the government,” the company said.
But for the remaining 30 percent of customers “there will be an average 81.8 percent increase to premiums,” Optima Health said.
The company said that about 20 percent of the price hike is how much Optima Health originally planned to raise prices by.
Another 23 percent of the increase reflects uncertainty about whether the Trump administration and Congress will guarantee payments to insurers that reimburse them for legally mandated discounts given to qualified, low-income Obamacare customers in their out-of-pocket health costs.
The remaining share of the price hike is the result of “the withdrawal of the national carriers” from the market, the company said.