MacIver News Service | October 25, 2016[Madison, Wis…] Health insurance plans sold on Obamacare exchanges will increase an average of 25 percent nationwide for 2017, federal officials announced on Tuesday. The national price spike is considerably higher than Wisconsin’s nearly 16 percent increase next year.
The drastic increase in prices was widely expected after several major insurers dropped out of Obamacare markets around the country, citing massive losses as a result of more expensive enrollees, fewer younger and healthier enrollees, and more people deciding to pay the penalty rather than buying increasingly expensive insurance plans.
While premium increases in Wisconsin are lower than the newly announced national figures, the price spike will still impact the Badger State. On average, Wisconsin Obamacare premiums will increase by 15.88 percent in 2017, according to an announcement by the state Office of the Commissioner of Insurance (OCI) earlier this month.
The OCI reviewed and approved the rate changes requested by Wisconsin insurance companies earlier in October.
One major insurer, Aetna, will increase its premiums by an overall 29.32 percent for its small group PPO plan, with increases varying from 7.59 percent to a maximum of 59.71 percent.
Dean Health Plan, Inc. will raise premiums for its individual HMO plan by an overall 18.73 percent, with rate changes varying from a 9.73 percent reduction to a 46.34 percent increase. The company plans a 2.91 percent decrease for its small group plan.
Gundersen Health Plan, Inc. will increase its premiums by an overall 9.33 percent for its small group plan and 18.36 percent for its individual plan – that plan’s premium increases range from 7.87 percent to 42.67 percent.
Blue Cross Blue Shield filed a 3.96 percent decrease for its small group plan, but that plan is listed as “off-exchange” and only affects 270 people.
WPS will increase premiums for its small group PPO plan by 9.78 percent overall, with increases ranging from a 4.3 percent reduction to a 55.66 percent increase. WPS will also increase premiums for its individual PPO plan by 5.39 percent overall, with changes ranging from a 14.8 percent reduction to a 20.94 percent increase.
The Arise Health Plan, a subsidiary of WPS, plans premium increases of 6.29 percent for its individual HMO plan and 3.14 percent for its small group HMO.
Last year, Obamacare-compliant plans saw premium increases between 11 and 19 percent, the MacIver Institute reported in December. In addition, our analysis found 600 fewer plans to choose from in 2016 compared with 2015.
The price increases are the result of an older and less healthy group of enrollees, factors that have caused several of the nation’s largest insurers to stop offering plans on Obamacare exchanges altogether.
UnitedHealth and Humana, two of largest health insurance companies in the country, both backed out of Wisconsin’s Obamacare exchange entirely earlier this year. Anthem also significantly cut back its offerings in 34 counties last year and withdrew from Milwaukee, Kenosha, and Racine counties entirely. With fewer companies competing in the Wisconsin exchange, premium increases have continued to far outpace inflation.
The decline in competitive markets has also played out nationally. According to reporting by McClatchy, 21 percent of customers shopping in Obamacare exchanges will find only one insurance company in 2017, compared with just 2 percent in 2016.
Even Minnesota’s Democratic governor recently acknowledged Obamacare’s failure to offer affordable care. “The reality is the Affordable Care Act is no longer affordable for increasing numbers of people,” Gov. Mark Dayton told the Associated Press earlier this month after state officials announced Obamacare premium increases of 50-67 percent for Minnesota in 2017.
MNS will continue to analyze premium, deductible and other pricing information as it becomes available and publish our findings as soon as possible.