Author Nefouse

When it comes to health care and group health insurance, Hoosiers have always preferred PPO networks which allow the member to choose which medical provider they want to receive treatment from.  With any group health plan, Indiana employees have demanded that they could choose their medical providers.  This is starting to change because the cost of care in Indiana is one of the highest in the country.

Insurance companies, medical providers and TPA have started to develop their narrow health care networks all so known as skinny networks.   

Medical providers have introduced their own health insurance plans in an attempt to attract employers that want to control costs.  These networks come in the form of Health Maintenance Organization (HMO) and Employer Preferred Organization (EPO).

IU Health Plans has its own hybrid HMO plan that has slowly gained membership. They offer a hybrid HMO that also provide a traditional PPO network.  These options can be competitive but the real cost savings comes from their tier 1 network which is a true HMO.  This HMO can deliver a 25% reduction in the premium vs. a traditional PPO plan.  IU Health plans promote an integrated care experience for members, where are the medical providers are in communication with one another.  The integrated model is supposed to deliver better treatment outcomes and a better overall experience for the patient.

St. Vincent’s recently launched their own health plan called Advantus which utilizes a skinny network of St. Vincent’s and affiliated medical providers.  AdvantUs is offering a self-funded/level funded health plans in the small and mid-size markets. These plans are potentially reduced costs by 10% vs other level funded products.  IF compared to a traditional fully insured PPO plan, the initial saving is more like 30%.

Anthem recently launched their own skinny network called health sync which is an HMO that currently utilizes the Franciscan network.  The product is for both small and large group. There is upfront savings vs. Anthem PPO network along with innovative programs to control future medical costs.

Employer Direct Contracting with the health provider.  Large employers can contract directly with the medical provider, which could exclude the traditional insurance company.  Negotiating directly with the medical provider for an exclusive contract can lead to a significant reduction in the cost of claims.  In some of Indiana’s communities, this approach could reduce medical costs by as much as 50%.

In the past Indiana, employees have been reluctant to accept narrow networks, with the skyrocketing medical cost now being revealed to the general public, employers are starting to entertain these cost controlling techniques.  The younger millennial generation is open to using skinny networks, which may lead to employers implementing these plans.

If you are interested in learning more about these options, contact us.

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There was a study conducted by the Rand Corp that examined payments rates by private health insurers in 25 states and Indiana was one of them.  The purpose of the study was exposing what health care providers charge compared to Medicare.

The study determined the dramatic difference in the cost of health care cost across the country.  This information could show lawmakers the severe challenge they face with regulating healthcare. It is hospitals that are charging the highest rates should have more government and industry attention.

The study proved that Indiana health insurance plans paid on average more than three times what Medicare did.  In Michigan, those medical providers charged closer to 1.5 times Medicare.

Indiana medical providers have been able to charge a great deal more than other states.  This could be a direct result of Hoosiers preferring a PPO network where different states have embraced narrow managed care networks.   Indiana hospitals systems have grown more and more powerful through mergers and acquisitions which may give them more negotiating power to receive higher reimbursement rates.  The medical community lobbying power may also have had something to do with it.

With this RAND study gaining more attention, Indiana businesses are starting to realize how much more we are paying for health care vs. employers in other states.  

What could employers do with this information?

One option would contract directly with medical providers. An employer would contact the hospital group directly and negotiate the reimbursement rates of healthcare for all their members.  This could result in employees using a limited network for care, which Hoosier have notoriously disliked but with this found cost information, Indiana employers may have no choice.

The direct contracting is now available for even small groups though Franciscan, IU or St. Vincent’s.

There is also the option of a group health plan that uses reference-based pricing to reimburse medical expenses. This is where medical costs are paid based off a multiple of the Medicare rate. The medical community in central Indiana has fought this type of reimbursed. Why should they make less than their 3x Medicare rate?

If Indiana medical providers refuse to discount their rates, then maybe a market correction is in order. With the Rand study showing Michigan with one of the lowest medical costs, maybe employers start sending all acute cases to Michigan for treatment.  If the company is self-funded, meaning they are paying the claims up to $500K, and there is member’s that need care that cost’s $400K in Indiana but the same level & quality of care in Michigan cost $200K, that is an easy decision to make.

That employer could charter a private jet for the member and family and still save a significant amount of money.

The Indiana medical community will eventually be held accountable for what they charge by either the government or by a free market.

Kaiser Health News – Market Muscle: Study Uncovers Differences Between Medicare And Private Insurers

Rand Corporation – Prices Paid to Hospitals by Private Health Plans Are High Relative to Medicare and Vary Widely

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All the Jan 1st Small Group Health Insurance Indiana and mid-market renewals have been released by the insurance carriers.  

Small Group Health Insurance Indiana with less than 50 Employees:

The two main carriers for central Indiana and the surrounding area are UnitedHealthcare and Anthem. There are few areas that have other carrier presences in the small Group Health Insurance Indianagroup market. In Southern Indiana, Humana has a large market share and in Fort Wayne PHP is the dominant carrier. IU Health plans show in areas where there are IU Hospitals.

Anthem small Group Health Insurance Indiana renewals are flat this year, after double-digit rate increase in 2018. UnitedHealthcare is averaging about a 7% increase. These rates increases are somewhat under control, but the small group ACA premiums have started to move to the unaffordability route. This may be due to community rating and how rigid the rules are with age bands.

Plan design is changing under the rules of the ACA. The plans are designed by actuarial values and each carrier is offering different options. Anthem is offering richer plan designs on their silver and gold plans. What make’s there plan richer is the coinsurance levels, where they have options with 100% coinsurance after the deductible is met. At 100% coinsurance, this is limiting the out of pocket for inpatient and outpatient procedures. UnitedHealthcare’s coinsurance is shifting more expense to the members with more plans having a 50% coinsurance. Without of pocket maximum increasing to over $7,000, this is already unaffordable for most Hoosiers.

2019 Small Group Health Insurance Indiana Options:

There has been a steady movement of small employers to use age-based premium, where the cost is determined by the member’s age. Yes, this can be an administrative headache if the group is not using a benefit admin system. The positive with age-based to help attract new employees with their health insurance cost is less.

UnitedHealthcare has been successful with their multi choice plans. This has allowed small employers to offer plans designs that fit their employee’s needs. Another technique that has controlled cost is the use of a gatekeeper who is the primary care physician that oversees all of the member’s health care services. UHC calls this network Navigate. At first, employees have had resistance to this approach, but with UHC vast network of doctors, it’s slowly becoming more accepted. Essentially, the Navigate plan forces the member to form a relationship with their doctor. This leads better treatment outcomes and a better overall experience for the member. This is not a new concept, it goes back to the days of managed care. Now, a Navigate plan can reduced health insurance premiums by a double-digit percentage.

IU Health offers a traditional “old school” Health maintenance organization (HMO). They are pushing an integrated care model where all the physicians are in communication with one another. This can have a positive impact on acute care cases. They seem to be competitive in areas where there is a high density of IU medical providers, which makes sense. The question many owners, CFO’s, & HR are faced with when entertaining the IU health plans, is 7% saving enough vs a PPO/EPO option.  Surprisingly most say NO. With IU owning the medical providers and the insurance plan you would think they could get more competitive on premiums. They can’t, and it’s doubtful they will. It’s about network discounts, why would they discount a procedure under the IU health plan when they can get the full amount from an Anthem, Cigna, or UHC plan. Hospitals also have revenues goals they must meet.

Self-Funded Solutions

There are now more and more options from carriers with partially/fully funded Self-Funded plans. There are a couple of large name brand companies that are offering these solutions, but Anthem of Indiana is not one of them. UHC has a division called All savers that is now providing a level-funded a plan to groups with just five employees.

Self-funded plans are not required to follow all the same rules of the ACA, which allows them to underwrite. The underwriting can create a 30% savings. If your company is currently insured in the ACA community rated market, it’s worth your time to look at level funded. In, 2019 the partial self-funded insurance vehicle is the go-to solution for the small group.  

 

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Small Group Rates Delayed 

Every year the health insurance companies of Indiana have to submit their rates and plan designs for approval through the Indiana Department of Insurance. In the past, this filing would be submitted for review and approval in the month of May.  The filing for 2019 small group fully insured policies was extended to the end of June. This extension has also extended when the department of insurance would approve the 2019 rates. 

The main Indiana insurance companies like Anthem and UnitedHealthcare are not sure when rates will be approved. It could be October 15th, or we could end up in the month of November before we have approved rates.

This delay is having large unintended consequences for Jan 1st small group both under the affordable care act and legacy groups!

80%+ of small groups renew Jan 1st.  Under the ACA fully insured market, these plan designs change every year. The plan changes are not just minor, we have seen deductible, co-pays, co-insurance have huge changes that create more cost sharing to the insured. A perfect example was UHC 2018 introduction of a plan that had 50% co-insurance for outpatient services. The plan was advertised as an 80% co-insurance plan but in the details (small print) it was determined outpatient was 50%. This creates a large cost sharing when the out of pocket max is $7,000+.

In a perfect world, a small group should make renewal decision at least 60 days prior to the actual renewal date. Under the ACA, by law small group fully insured renewal rates must be released 90 days in advanced. 

If 2019 rates are not approved until November, Indiana small companies will not have much time to make decisions or even review alternate options. 

Every Insurance agency/broker active in a small group (there is not a lot of us) is going to be overwhelmed with request for proposals and learning the new group insurance policies being offered. 

group insuranceNefouse & Associates Solution for Small Group:

Our solution to the 2019 small group rate delay is both being proactive and utilization of technology. First, it must be determined if the fully insured market is the best option for your company.  If your small group company is relatively young and healthy, then reviewing partially self-funded options may be in your company’s best interest. 

With the bulk businesses renewing for Jan. 1st, technology is becoming the quickest option for enrolling and employee education for small Indiana groups. We offer a benefit admin platform delivers on both the education, installation and new employee on-boarding. We can build out a client’s enrollment platform in less than three hours, with employees reviewing and enrolling in company benefits in less than 24 hours. The platform is customized to the clients’ company with logos and dedicated domain name. This is one of the added services we provide our clients at no additional costs.

Our proactive broker approach is all about dedicating the time to reviewing the plan contracts to advise our clients of the best option. Contract review is difficult during normal business hours and really has to be done after hours, this way there are no distractions. Once reviewed, we ask the carriers for an explanation of the area of uncertainty. The response time to these questions can be long, the carrier rep normally will not answer them as they don’t know or want to take on the liability. If the insurance companies legal must give the answer, it can take over a month. If the summary of the benefit chart does not match up with the plan quote, it may be better to disqualify that plan design as an option. If we (as your broker) do not have access to a certificate of coverage (COC), which we won’t until after the plan is issued, you have to be very cautious on plan election.

For Indiana small group health plans, using a broker like Nefouse & Associates that actually cares is the first decision that has to be made.  If you are a small Indiana business will no employees or less than five, you may be a good candidate. Contact us, and we can provide information on the Jan. 1st 2019 Small Group Rates.

 

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Starting in the 4th quarter of 2018, we could see the release of association health plans in Indiana and the rest of the country. Under the final rules from the Department of Labor, a small business can join to form association health plan (AHPs), this would give the small employers access to large group health insurance coverage.

One aspect of the final ruling that has received no attention is old association health plans (AHPs) can continue to operate under pre-Affordable Care Act rules. The old rules allow an insurance company to underwrite the small group and assign a risk factor, which then determines the cost. The small group must have at least two full-time employees, but they can be husband and wife. Currently, Indiana has active associations that are offering access to health benefit under the old rules. American Society of Civil Engineers, Indiana Dental Associations, Indiana Manufacturers Association Group Insurance Trust, National Funeral Directors Association, Banking, Faith-Based, Social Services, and Transportation and others.
These association health plans can be viable solutions for small group vs community rates under the ACA. If a group received the best-case scenario after underwriting, a group could save over 20% vs full insured rates. The association should also have an additional premium discount on the 20% maybe another 5%.

Most associations with 500+ members can investigate setting up associations that are operating under the pre-ACA rules of underwriting each case. The insurance company is limiting their risk with the per case underwriting practices but if your small company can reduce their health insurance premium, why not look at this option.

The new rules for creating AHPs is not attracting much competition. First, the insurance companies are not allowed to develop the health plan. They can administer it, but the associations must put it together. Most associations may not have much experience in developing health insurance vehicles. The insurance companies are hesitant about any insurance products that are guaranteed issue. The ACA has proven the guaranteed issue market can create substantial financial losses for carriers. Any association health plan that is self-funded will governed under the multiple Employer welfare arrangements (MEWA) at a state level, which prevents them from being a multi-state.

The fourth quarter of 2018, we should see a push from AHPs operating under the old rules of underwriting.
Here at Nefouse & Associates, we are looking to develop an AHP for Indiana that will take effect in 2020. If you are a small Indiana business will no employees or less than five, you may be a good candidate. Contact us, and we can provide information on the AHP development.

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Indiana was one of six states to file a lawsuit against the Affordable Care Act’s health insurance provider fee (HIPF) for State Medicaid plans.

The U.S. District Judge ruled in favor of the plaintiffs, Texas, Indiana, Kansas, Louisiana, Wisconsin & Nebraska’s that the government must pay back $840 Million in Obamacare fees.

What is the Health Insurance Provider Fee?

The HIPF is an annual fee charged to health insurance companies on health insurance premiums. The Patient Protection and Affordable Care Act of 2010 assesses fees on insurance companies that provide fully insured health insurance coverage. 

The fully insured tax/fee is 3% of the total health insurance premium.

Business affected:

  • Individual and small group health insurance plans.
  • Large Group Health plans.
  • Stand- alone, dental & vision plans.
  • Stand-alone, behavioral health, and pharmacy plans.
  • Medicare Advantage plans.
  • Retiree-only plans.
  • Medicare part D prescription plans
  • Taft-Hartley Plans
  • Medicaid and Children’s Health Insurance programs (CHIP). Until recent court ruling!

The purpose of the tax/fee is to help fund federal and start marketplaces/exchange.

The estimated cost is $14 billion a year.

The authors of the ACA & PRACA projected that there was going to be enormous profits for the insurance industry because of the Individual Mandate. Thus, they could tax the industry to fund the law. They also assumed that these profits would create carrier competition.

The reality is the insurance industry passed this cost on to the members, which has led to everyone paying about 3% more to fund health care reform.

The fact that Medicaid plan is now exempt from the ACA tax is a massive blow to the ACA and the funding mechanism.  Indiana alone has over 2 million people on Medicaid, and it’s not clear the government can make up for this loss of funding for the ACA.  $840 Million is a year is just a start, other states will follow and with an estimate of $5.5 billion attributed to the Medicaid tax. 

This is a massive blow to the ACA law, that is has gotten almost no attention!   The funding of Obamacare may have just lost 25% of its funding.  This estimated operating costs for the marketplace is $2.1 billion.

It will be interesting to see if the government adjusts the federally facilitated marketplace. There could be a decision to turn those operations over to a third party. 

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All the health insurance companies that want to participate in Indiana’s small group health insurance has submitted rates & plan designs to the Indiana Department of Insurance for review. These filling are for fully insured groups with less than 50 employees.

As always, it’s going to be an interesting year under the rules and regulations of the Affordable Care Act (ACA).

Under the ACA, small group health insurance plans are changing every year.  This has led to frustration with many Indiana small group employers.  Pre ACA, a company, would purchase a health plan, and that plan did not change until the company chooses to change it.  Now, a company could have a $2,500 deductible silver plan in place, but the renewal is mapping them over to a new Silver plan that has a $4,000 deductible.   It’s difficult for most people to see how a $2,500 deductible silver plan is the same as a $4,000.   

Under the ACA, the insurance company is forced to develop plans that meet an actuarial value that then indicates if they are Bronze, Silver, Gold or Platinum.  That actuarial value changes or is interpreted differently every year. Which leads to plan designs being a change in the small group health insurance.

We can’t put all the blame on the ACA with the forced plan changes in the small group.  I believe that if a carrier has higher claims utilization on certain plan design, they discontinue that plan.

As we review 2019 Indiana’s small group plan submissions, most of the cost information is listed in averages, which does not tell the full story.  If a carrier is introducing new plan designs, it’s difficult to determine what the cost increase or decrease as compared to their prior year’s plans.   When we look at the details, rates are determined by counties.  For example, Boone County could have a rate decrease on all of their Silver plans, while Marion County has a rate increase.   Then each plan design has a different cost, and some carriers will offer seven different silver plans.   The average price does not tell the full story.

2019 Small Group Submission

  • Anthem appears to have an average rate increase of 2.5%.
  • UnitedHealthcare appears to have an average rate increase of 8.14%
  • IU Health Plans seem to have an average rate increase of 7.21%

There are a handful of other companies that have filed, but their small group rates are so high that I don’t think they are worth mentioning. Those companies don’t want to compete in the small group market but submit plans, so should they wish to fight in future years there is less barrio of entry.

Anthem filing has decreased on specific plan designs as high as 9%.  In 2018, Anthem increased the cost of their small group on avg of 17%. That rate increase made them less competitive in the under 50 life market.   For 2019, Anthem is trying to get competitive based on the few small group carriers we have in Indiana.

UnitedHealthcare filling is difficult to read because it appears most of their 2018 small group plan designs will be discontinued.  New plan designs will be introduced, which could be a good thing. Last year, UHC offered plans that created many confusions.  They had Silver plans that 80% coinsurance but had different coinsurance levels for specific procedures like outpatient surgeries.  One had to dig deep into the summary of benefit chart to find these carve-outs.  As with Anthem, specific metallic level plans and counties have a different rate increase, so again the plans must analyze for costs and coverages. 2018 UHC was anywhere from 17%-8% cheaper than Anthem.  This led them to pick up a much more significant market share in Indiana small group.   UHC also offered a true multiple-choice option for the small group. This strategy appealed to a lot of small companies, where their employee had different health insurance needs.   With 8% average rate increase, Anthem & UHC should be comparable from a price standpoint.

IU health plans are the HMO which IU health has ownership in. With their average rate increase, they should be below both UHC & Anthem.  In 2018, IU health plans have cost about 7% less than the competition, but that is for a health plan with access to only IU providers.  Indiana small group employers have shown some reluctance to move to a true HMO. The 7% saving has not been enough.

Under the ACA, we see a reluctance from many carriers to compete for small group business. This lack of competition has led to just a few fully insured options. It’s not usually for a small group to switch back and forth between UHC and Anthem. With network access being similar along with plan designs, a small group should take advantage of saving 7%. This back and forth strategy are simplified by using benefit administration platform, which streamlines the enrollment process with the least amount of employee disruption. 

Indiana along with the rest of the country has seen a considerable influx of level-funded/partially self-funded plans enter the marketplace. These options have created substantial cost saving for small groups that are overall healthy.  Level funded allows a group to get lower health insurance costs by going through underwriting.  Groups with as few as five employees are eligible.  The level funded option on average saves a group around 20%. That savings can be even higher if the group has a high amount of dependent participation.   

2019 will be another challenging year for small group health insurance.  An owner will wont to be proactive with their insurance offering by starting their benefits review at 90 days before the renewal. 

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The Trump administration released its final rule on short-term health insurance.
Short-term health insurance is a policy that is very similar to pre-affordable care act coverage. The plan does not cover preexisting conditions and requires underwriting. If your accepted, the cost is 50%-60% less than an ACA product. These plans are also using traditional PPO networks, which gives greater access to medical providers.

The final rule allows for short-term coverage to be extended up to 36 months. Currently, coverage can be offered up to 90 days. This could be a game changer in the current individual health insurance markets. Even though the final rule states a plan can be offered for 36 months, does not mean that all insurance companies will embrace this. We could see contracts that are guaranteed renewable for 36 months.

There is much criticism that these short-term plans will negatively impact the ACA marketplace. That criticism is valid because if someone is healthy and can obtain a 36-month policy for 50% less, that will be very attractive. Then the ACA pools will lose a portion of the healthy members that help to offset higher utilizers. Thus ACA rates will increase.

Why did the Administration Extend Short Term Plans?

Currently in Indiana and the rest of the country, if you are not eligible for tax credits/subsidies on the marketplace, the premiums are astronomically for most middle-class families. Then add in the limited network access with huge out of pocket maxes, it’s not uncommon for a family to have $17,000 in premium with potentially another $14,000 in out of pocket, that could cost a family $30K a year.

That same family looks at the short term for $7,000 a year with the same out of pocket, given the short term does not provide the same level of coverage or covers pre-existing conditions. If a family is healthy, it’s hard not to entertain the short-term option. That is why the administration extended short-term plans.

Short-term plans are underwritten which is where you have to answer medical questions and can be denied the plan. Most of these policies are now enrolled through web-based applications, which makes for easy enrollment. The insurance companies use a technique called Post Claim Underwriting when you have a claim. This where the insurance reviews your past medical history to determine if the claim was preexisting. If it is a prior condition, the insurance company can and will deny the claim. One of the real problems with Post-claim underwriting is the delay of payment to the medical provider. The insurance company may request all your medical records for the past five years. Even if you are persistent most medical provider will take at least a month to release records. If you get diagnosed with the condition that needs immediate treatment, the delay in payment could prevent an obstacle to continuing treatment.

In 2018, short-term insurance sales exploded in Indiana and the rest of the country. Smaller insurance companies got creative with their product offering. To be compliant with the rules set by the Obama administration, short-term was only good for 90 days, and companies created 3×4 policies that included 4 short-term policies with one application. These created a huge saving for health Indiana families. Now with the new ruling, I would predict that UnitedHealthcare & Humana launch new short policies.

When you start looking to purchase a short-term policy, buyer beware. You need to make sure you know what you are buying. Always look at the last page of the brochure that lists exclusions. With these plans, you may want to consider buying them from a name brand carrier.

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Short Term Health Insurance Final Rule 36 months of coverage

Short-term health insurance is a policy that is very similar to pre-affordable care act coverage.  The plan does not cover preexisting conditions and requires underwriting.  If your accepted, the cost is 50%-60% less than an ACA product. These plans are also using traditional PPO networks, which gives greater access to medical providers.

The final rule allows for short-term coverage to be extended up to 36 months. Currently, coverage can be offered up to 90 days.  This could be a game changer in the current individual health insurance markets.  Even though the final rule states a plan can be offered for 36 months, does not mean that all insurance companies will embrace this. We could see contracts that are guaranteed renewable for 36 months.

There is much criticism that these short-term plans will negatively impact the ACA marketplace. That criticism is valid because if someone is healthy and can obtain a 36-month policy for 50% less, that will be very attractive. Then the ACA pools will lose a portion of the healthy members that help to offset higher utilizers. Thus ACA rates will increase.

Why did the Administration Extend Short Term Plans?

Currently in Indiana and the rest of the country, if you are not eligible for tax credits/subsidies on the marketplace, the premiums are astronomically for most middle-class families.  Then add in the limited network access with huge out of pocket maxes, it’s not uncommon for a family to have $17,000 in premium with potentially another $14,000 in out of pocket, that could cost a family $30K a year.

That same family looks at the short term for $7,000 a year with the same out of pocket, given the short term does not provide the same level of coverage or covers pre-existing conditions. If a family is healthy, it’s hard not to entertain the short-term option.   That is why the administration extended short-term plans.

Short-term plans are underwritten which is where you have to answer medical questions and can be denied the plan.  Most of these policies are now enrolled through web-based applications, which makes for easy enrollment. The insurance companies use a technique called Post Claim Underwriting when you have a claim.  This where the insurance reviews your past medical history to determine if the claim was preexisting. If it is a prior condition, the insurance company can and will deny the claim.  One of the real problems with Post-claim underwriting is the delay of payment to the medical provider.  The insurance company may request all your medical records for the past five years.  Even if you are persistent most medical provider will take at least a month to release records.  If you get diagnosed with the condition that needs immediate treatment, the delay in payment could prevent an obstacle to continuing treatment.

In 2018, short-term insurance sales exploded in Indiana and the rest of the country. Smaller insurance companies got creative with their product offering. To be compliant with the rules set by the Obama administration, short-term was only good for 90 days, and companies created 3×4 policies that included 4 short-term policies with one application.  These created a huge saving for health Indiana families.  Now with the new ruling, I would predict that UnitedHealthcare & Humana launch new short policies.

When you start looking to purchase a short-term policy, buyer beware. You need to make sure you know what you are buying. Always look at the last page of the brochure that lists exclusions.  With these plans, you may want to consider buying them from a name brand carrier.

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It was reported that the Trump administration has reinstated the risk adjustment program of the affordable care act.

The risk adjustment program redistributes funds from carriers with lower risk members to plan with higher risk member.  The reason this was witten in the ACA was to protect against adverse selection in the marketplace by spreading the financial risks across the markets.  Authors of the ACA through this program would prevent insurance companies trying to attract healthier members and compete based on the value of product offering. 

The risk adjustment program was a failure because more insurance companies were requesting payment, than paying into. This was the legal argument on why the current administration suspended payments based on the law being deficit neutral.

How this Impacts Indiana?

In the individual market, we only have the two insurance companies offering coverage. Both Ambetter and CareSource included receiving risk adjustment payments in their 2019 filings with the Indiana Department of Insurance.  Had the payments for Risk adjustment not been reinstated, then these two insurance companies would have had to raise their premiums.

Ambetter would have had to raise premiums by an average of $23.03 per member per month ($276.36 yr.)

CareSource would have had to increase premiums by an average $65.22 per member per month ($782.64yr.)

The administration had to reinstate the payment, even if they don’t believe in it. The few insurance companies still participating in the individual markets, were developing products based on the existing rules.  When reviewing the insurance company’s filings which justifies the premium they intend to charge, the risk adjustment receivables can determine if the company will be profitable.  The individual plans are operating on less than 5% profit margin, and if receivables represent more than 10% of the premium, without out it,  those companies could lose money and decide to withdraw altogether.

Contact Us if you are interested in learning more!

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