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new-jersey guide to health insurance

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New Jersey health insurance exchange / marketplace

3 individual exchange carriers request double digit rate hikes on some plans

King v. Burwell – subsidies safe

On June 25, the Supreme Court ruled that subsidies are legal in every state, including those that use  That means subsidies are safe for the 182,000 people in New Jersey who currently receive them, and they’ll also continue to be available for future enrollees.  New Jersey has a federally-run exchange, and plaintiffs in the case argued that the ACA only allows for subsidies in state-run exchanges.

Over the last few years, Governor Christie has twice vetoed legislation that would have put the state on a path to creating its own exchange.  But NJ Senator Nia Gill introduced the legislation again in 2015.  Her bill, S540, would create a state-run exchange in New Jersey – but it didn’t advance out of committee during the 2015 session.  Gill has been critical of Gov. Christie’s vetoes of the prior exchange-creation legislation, noting that New Jersey subsidies wouldn’t have been dependent on outcome of the King case if the state had created its own exchange.

If the King plaintiffs had prevailed, coverage would become unaffordable for most of the people who would have lost subsidies, and it would also have become unaffordable for tens of thousands of other New Jersey residents who buy their own health insurance without subsidies.  The American Academy of Actuaries estimated that premiums market-wide would have increased by at least 35 percent in states where subsidies are eliminated – and it could have been as high as 55 percent – in addition to the regular annual rate hikes based on medical cost inflation.  Luckily for the residents, employers, medical providers, and insurance market stability, subsidies have passed the Supreme Court test and are here to stay.

2016 rates’s rate review tool allows consumers to see proposed rate increases of ten percent or more, although single-digit proposed rate hikes don’t show up on the list.  In New Jersey, three individual market exchange plans have requested rate increases of at least ten percent: Horizon Blue Cross Blue Shield, Oxford Health Plans, and Freelancer’s CO-OP.  The highest among them is a proposed 18 percent increase for the CO-OP.

Although Horizon BCBS has requested a double-digit rate increase for three of its EPO plans, another EPO – expected to cover two-thirds of the company’s Advantage EPO enrollees by the end of this year – will see a rate increase of less than ten percent in 2016.  The other two exchange carriers, AmeriHealth and Oscar, did not request double digit rate hikes for 2016.

Rates are currently under review, and it will be several weeks before they’re finalized.  If approved, the proposed double digit rate increases will apply to about half of the current exchange population, although enrollees will be able to switch to a different plan during open enrollment in order to avoid rate increases.  Open enrollment begins again on November 1, for coverage effective January 1, 2016.  Open enrollment will once again be three months long, ending on January 31.

In addition to the individual exchange plans, some small group and off-exchange plans have submitted rate proposals that include double-digit rate hikes.

How many people have enrolled?

254,316 people enrolled in the New Jersey exchange during the second open enrollment period, from November 15 to February 22, and 83 percent of them qualified for premium subsidies.  The enrollment total includes 133,215 renewals from 2014, of which 75,712 were “active” renewals (as opposed to auto-renewals).  Of the active renewals, 45,197 picked a new plan for 2015 rather than keeping their existing 2014 coverage for another year.

Joel Cantor, director of the Rutgers Center for State Health Policy, had estimated that total private plan enrollment in the New Jersey exchange could reach 250,000 people by the end of the 2015 open enrollment period, and it turns out that his prediction was pretty spot-on.

Another 60,757 New Jersey exchange enrollees were eligible for Medicaid or CHIP between November 15 and February 22.

Open enrollment for 2015 has ended, and this applies to plans purchased outside the exchange as well as plans within the exchange.  Most applicants can only purchase 2015 coverage at this point if they have a qualifying event (Native Americans and those who qualify for Medicaid/CHIP can enroll year-round).

People who don’t have health insurance coverage in 2015 will face a much more significant penalty than they did last year:  $325 per uninsured adult (half that amount for children under 18), or 2 percent of household income, whichever is greater.

Two new carriers in 2015 brings exchange total to five

In 2014, only three carriers participated in the exchange in New Jersey:  Horizon Blue Cross Blue Shield, AmeriHealth, and Health Republic of New Jersey (Freelancer’s CO-OP).  For 2015, two more carriers have joined them:  UnitedHealthcare (Oxford Health Plans) and Oscar Health Insurance.

Health Republic is a new consumer oriented and operated plan, or co-op, created under a provision of the ACA, and Oscar Health Insurance is an innovative new carrier that started in New York last year and is expanding to New Jersey.

What about premiums?

In the Newark area, the second-lowest-cost silver plan (the benchmark plan) could be less expensive in 2015 than it was in 2014.  According to data from the Kaiser Family Foundation, the average in 2014 for a 40 year old non-smoker was $322 per month, and that’s dropped to $316 per month for 2015 (though in most areas, staying with the benchmark plan means switching carriers for 2015).

In Bergen County, the carriers offering the lowest-cost silver and bronze plans, as well as the second lowest-cost silver plan, are all different from the carriers that offered those plans in 2014 – highlighting the importance of shopping around during open enrollment.

The New York Times Upshot has an interactive map that further details the importance of shopping around during the 2015 open enrollment period.  For New Jersey residents (Newark area) who had the benchmark plan in 2014 and opt to simply renew that same plan, the average rate increase for 2015 is roughly 11 percent.  But people who shop around and switch to the new benchmark plan will see an average rate increase of just 2.2 percent.

And across all plans and metal levels in the exchange, an analysis from the Commonwealth Fund found an average 2015 premium increase of just 2 percent for a 40 year-old non-smoker.

The relatively low level of competition in 2014 – just three carriers in the exchange – is one of the reasons given for the higher-than-average premiums in New Jersey during the first open enrollment period.  According to a report released by the U.S. Department of Health and Human Services (HHS), the average 2014 cost for a bronze plan —the lowest-cost option — in New Jersey was $332 in 2014, compared to a national average of $249 a month.  But the entry of two new carriers has helped to hold down the average benchmark plan rates for 2015.

An HHS survey in mid-June found that New Jersey had the highest average after-subsidy cost for health insurance among the 36 states where HHS is running the exchange: $148 in New Jersey, compared with an average of $82 across all 36 states.  This is indicative of not only higher unsubsidized premiums, but also higher average incomes in NJ, and perhaps an affinity for plans with higher metal levels.  For people with the same income level (assuming they are subsidy-eligible), it doesn’t matter what state they live in or how expensive the unsubsidized premiums are — the subsidy amounts will differ, but the after subsidy premiums for silver plans will be the same, since the ACA sets net premiums as a percentage of income.

Targeted outreach and more experienced navigators

Navigator organizations in New Jersey have more data and experience in the second open enrollment period than they did a year ago.  They have zip code based information in terms of where people have enrolled and where there are still large pockets of eligible people, so they can better target their outreach.

Get Enrolled America’s New Jersey branch learned last year that recurring enrollment events work better than one-time events, and also that people are more likely to enroll after being contacted at least four times.  They’re incorporating that information in their enrollment strategies for 2015.

The New Jersey for Healthcare Coalition has an improved website – – where people can find local assistance with the enrollment process and learn more about the ACA and enrollment in general.

2014 enrollment data

For the 2014 open enrollment period, by April 19,  161,775 people had completed their enrollment in private plans through the New Jersey exchange.  Private plan Obamacare enrollments in the New Jersey exchange were nearly 70 percent higher than HHS had predicted last year, prior to open enrollment (the projection was about 113,000 people in 2014).  Every state saw a surge in enrollment in March and early April, but New Jersey’s was the seventh largest  surge in the country.

The carriers in New Jersey have been forthcoming with their enrollment numbers though.  AmeriHealth had 130,000 enrollees as of early September (up from about 10,000 at the end of 2013), and Horizon BCBS had 140,000 by mid-August.  Health Republic had enrolled roughly 4,000 new members.  These totals are for the carriers’ full book of business, including both on and off-exchange enrollments.  But AmeriHealth reported that the majority of their new enrollments have been through the exchange.

More health plans on the horizon?

In mid-October, two NJ hospital systems – Hackensack University Health Network and Meridian Health – signed preliminary paperwork to begin a merger process, although the deal still has to be approved by regulators.  If approved, Hackensack Meridian Health would become the largest hospital system in NJ, and would include nine acute-care hospitals, two children’s hospitals, and numerous doctor’s offices, rehab centers, skilled nursing facilities, and assisted living centers.

Officials are predicting that if it goes forward, the merger will lead to the creation of new provider-managed health insurance plans, which could bring more competition to the NJ health insurance market.

ACA’s impact on the uninsured rate

In addition to the people who have purchased private plans through the exchange, another 343,000 people had enrolled in New Jersey’s expanded Medicaid by mid-October.  That means about 74 percent of the total Medicaid-eligible population in the state enrolled in the first year expanded Medicaid became available (Medicaid enrollment continues year-round).  From December 2013 through October 2014, total Medicaid enrollment in New Jersey grew from 1.28 million to 1.65 million people.

In September 2013, New Jersey’s uninsured rate was 21.2 percent.  By June 2014, that rate had dropped to 11.5 percent, according to a study by the Robert Wood Johnson Foundation.   In less than a year, the ACA has halved the uninsured rate in New Jersey.

Congressional outreach and legislation

In late February, 11 New Jersey lawmakers — all Democrats — partnered with Get Covered America to volunteer their time in helping NJ residents get enrolled in the exchange.  The lawmakers’ staff members also helped with the enrollment effort, which was Get Covered America’s largest partnership with state lawmakers in the country.  Their involvement was part of the reason for the extremely successful final couple of months of open enrollment in New Jersey.

In mid-January, U.S. Rep Bill Pascrell (D, NJ) introduced a bill that would allow HHS to recoup ACA outreach funding that remains unused by Republican governors like Chris Christie who have refused to use the money in their states to promote the ACA and educate residents about its benefits.  New Jersey officials were involved in lengthy discussions with HHS over the use of $7.67 million in federal funds that had been granted to NJ in 2012 to use for promoting the state’s health insurance exchange.

The money was intended for outreach, advertising and general promotion of the ACA and the exchange, although NJ officials wanted to use it to staff a call center for the state’s expanded Medicaid program.  But HHS had made it clear last year that such a use was not permitted.

Ultimately, the state and HHS were not able to come to a compromise on the issue.  New Jersey forfeited the money on February 20 when the deadline passed, and HHS officially rescinded the funds in early May.

History of the New Jersey exchange

The New Jersey Assembly passed two bills authorizing a state-run exchange in 2012, but both were vetoed  by Gov. Christie. Those vetoes left the federal government to operate the health insurance marketplace in New Jersey.  Governor Christie has taken a very hands-off approach to the ACA, and the state has done little to promote the HHS-run exchange, leaving most of the heavy lifting to brokers, navigators and HHS.

The state did opt to expand Medicaid however, making health insurance available to hundreds of thousands of low-income residents.

New Jersey health insurance exchange links

State Exchange Profile: New Jersey
The Henry J. Kaiser Family Foundation overview of New Jersey’s progress toward creating a state health insurance exchange.

New Jersey Health Insurance Exchange
An overview of health exchange issues from the consumer advocacy group New Jersey Citizen Action.

Principles for Establishing a Pro-Consumer NJ Health Insurance Exchange (PDF)
From NJ For Health Care