The departure of UnitedHealthcare could leave Kansans shopping on the federal online marketplace with only one choice of insurer, but Kansas Insurance Commissioner Ken Selzer is working to bring in more.
Deputy Commissioner Clark Shultz said Selzer has for several months been in talks with other insurance companies about joining the marketplace in 2017, and those discussions appear close to yielding results.
“It’s too early to announce that and we don’t have it secured, but there are some very positive developments,” Shultz said.
The online marketplace is part of the federal Affordable Care Act. It is a central website, healthcare.gov, where Americans can shop for private health insurance and qualify for federal subsidies based on income.
If another insurer does not join the marketplace, Blue Cross and Blue Shield of Kansas will be the only option for Kansans, though they will be able to choose from multiple Blue Cross plans.
UnitedHealthcare announced last week it will withdraw from most of the 34 states where it sells marketplace health insurance after losing $475 million last year. This was the first year the company has insured Kansans through the marketplace.
“They announced they wish they had waited a little bit longer before getting in,” Shultz said. “I think they got into a lot of markets and sustained some fairly heavy losses and then regretted getting in, so they just decided to change their course.”
Coventry left the Kansas marketplace last year.
Sheldon Weisgrau is the director of an ACA consumer education program at the Kansas Association for the Medically Underserved. He said it’s difficult to know at this point the effect of UnitedHealthcare’s withdrawal.
Weisgrau said Blue Cross already dominates the Kansas marketplace, insuring about 80 percent of the 101,555 Kansans who purchased plans during 2016 open enrollment.
The 20 percent of those Kansans insured by UnitedHealthcare won’t be able to auto-renew their marketplace policies next year and will have to go back to the website and shop again. But Weisgrau said all Kansans who buy health insurance on the marketplace should do that anyway to get the best deal.
“I think they got into a lot of markets and sustained some fairly heavy losses and then regretted getting in, so they just decided to change their course.”- Clark Shultz, deputy insurance commissioner
Insurers still are trying to feel out the costs and benefits of selling on the marketplace, he said. As that process becomes more precise, and the pent-up medical needs of previously uninsured customers trends down, the “captive audience” of healthcare.gov shoppers will become more enticing.
“In the end, it’s probably better for consumers to have more choices of more insurers, but I don’t think it’s at all a failure of the marketplace if there’s only one insurance company that’s offering plans (next year),” Weisgrau said. “It’s still very early in the game, and this is going to shake out over several years.”
Weisgrau said it’s too soon to tell if having only one insurer in the marketplace would increase premiums.
Shultz said he did not foresee that happening because Blue Cross has “been a very good player” that is “very interested in insuring Kansans.”
“Their rates for 2017 are going to be based on what has happened in the past for them,” Shultz said. “In other words, I don’t see that, ‘Well, we’re the only player, so now we can hike our rates.’ I don’t think they’ll do that.”
Shultz said if two or three additional insurance companies join the marketplace, they might bring with them lower premium options, especially after the Legislature passed a bill allowing insurers to sell plans that only reimburse for in-network care.
Selzer is working to create those kinds of options, he said.
“The commissioner, when he ran for office in 2014, it was on a plank of getting other companies to sell products within the state — not only health, but auto and life policies as well,” Shultz said. “This has been a continuous project for Commissioner Selzer. Obviously when you have a company pull out, that makes it a little more pressing. But from day one, that’s what he’s been about.”