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North Carolina health insurance exchange / marketplace

560k enrollees in NC exchange for 2015, but 500k people - half of them young adults - stuck in the coverage gap

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  • March 22, 2015

2015 enrollment

As of February 22, when the 2015 open enrollment period and extension had ended, 560,357 people in North Carolina had finalized their private plan enrollments through the exchange.  HHS had projected North Carolina’s total exchange enrollment to reach 455,000 by the end of open enrollment, but the state had already surpassed that number more than a month prior to the end of open enrollment, and ended up at 123 percent of the projected total.

92 percent of the North Carolina exchange enrollees qualified for premium subsidies.  And 51 percent – 274,227 people – were new to the exchange for 2015.  The other 49 percent already had coverage through the exchange in 2014.

Another 47,920 exchange enrollees in North Carolina were eligible for Medicaid or CHIP during the 2015 open enrollment, despite the fact that the state has not yet expanded Medicaid and eligibility is still based on the unchanged guidelines.  Medicaid/CHIP enrollment continues year-round, but tends to increase during open enrollment due to the additional marketing and outreach from the exchange.

Open enrollment for 2015 is over, although there’s a special enrollment period for people who weren’t previously aware of the penalty for being uninsured in 2014.  Other than that, you can only purchase a 2015 individual plan in North Carolina (including outside the exchange) if you have a qualifying event.  The next open enrollment period begins on November 1, for coverage effective January 1, 2016.

More competition in NC exchange in 2015

In late September, Carolinas HealthCare System announced that it would be partnering with Blue Cross and Blue Shield of NC to offer a new health plan called Blue Local.   The plan is available for 2015 through the federally-run exchange in North Carolina.

In addition, United Healthcare filed paperwork in late June to offer individual health insurance in the North Carolina exchange (United already has a strong market share in North Carolina, outside the exchange).  In 2014, coverage was only available through two carriers: Blue Cross Blue Shield of North Carolina and Coventry Health Care of the Carolinas.  But nearly two thirds of the state’s 100 counties had only Blue Cross Blue Shield as an option, because Coventry only offered plans in 39 counites.

But rates still higher than average

PricewaterhouseCoopers LLC tracked rates throughout the fall, and determined a weighted average rate increase of 9.8 percent for individual coverage in North Carolina, including on and off-exchange carriers (nine carriers total in NC).  This is higher than the national average of 5.4 percent.

The Commonwealth Fund’s analysis of exchange plans in North Carolina came up with an average rate increase of 12 percent for 2015.  And a Kaiser Health News analysis found that premiums for silver plans in 2015 would be 8.5 percent higher in North Carolina than they were in 2014.

But in the Charlotte area, the benchmark plan (second-lowest cost silver plan) and the lowest cost silver plan are offered by a different carrier than they were in 2014, and in some areas of the state, people who are willing to switch to the new benchmark plan can get very modest rate increases or even rate decreases.  Throughout the state, there is significant variation in prices depending on where you live.

Among the 34 states with fully-HHS-run exchange, only four states (Alaska, Maine, New Jersey and Wyoming) have premiums for the lowest-cost silver plans that are as high or higher than North Carolina’s average.

Double digit rate hike for BCBSNC enrollees

The dominant carrier in the NC individual market, Blue Cross Blue Shield of NC, announced its 2015 rates in late October.  For ACA-compliant plans, BCBSNC increased rates by an average of 13.5 percent.  This applies to about 315,000 customers in North Carolina.  About 232,000 of them purchased their 2014 coverage through the exchange, while the rest purchased ACA-compliant coverage outside the exchange.

BCBSNC’s grandfathered plans are seeing similar premium increases – an average of 13.4 percent (initially, the carrier sent out incorrect notices to some policy-holders with grandfathered plans).  For grandmothered BCBSNC plans (those that were purchased after the ACA was signed into law, but before the end of 2013), the average rate increase will be 19.2 percent.  Neither grandfathered nor grandmothered plans can be purchased anymore, but about 239,000 people in North Carolina still have those older plans that are not fully compliant with the ACA.

2014 enrollment success

As of mid-April, when the 2014 open enrollment period ended, North Carolina’s exchange had the third highest enrollment among the 36 states where HHS is running the exchange, and was fifth highest for the whole country.  357,584 people had finalized their private plan selections, and another 73,898 were eligible for existing Medicaid, even with its strict eligibility guidelines (NC is not expanding Medicaid under the ACA).  

In terms of the rate that the uninsured population is enrolling in new plans, North Carolina is by far the leader among states that have generally resisted implementing the ACA.  The private plan enrollment total in the North Carolina exchange is nearly double what HHS projected before open enrollment began.  By early July, the uninsured rate in North Carolina had dropped from 19.6 percent last year, to 16.7 percent.

Keys to NC’s success

So why did North Carolina do so much better in 2014 than other states where lawmakers have not embraced the ACA?  Although many of North Carolina’s political leaders have been less than enthusiastic about the ACA, the state already had an excellent Medicaid managed care program – Community Care of North Carolina.  This public-private collaboration of health care providers, social services workers and other community leaders took an all-hands-on-deck approach, and has been steadily working for the last six months to enroll as many of their patients and residents as possible.

North Carolina’s legal aid program has also been very instrumental in getting people enrolled, and has established a phone number (855-733-3711) where residents can call to get help with their insurance questions.  These grass-roots programs have demonstrated that even in the absence of political leadership, states can have successful enrollment if they have a solid framework of community and health care leaders who are focused on getting people covered.

During the 2015 open enrollment period, Legal Aid of NC navigators are available each Tuesday at FirstHealth of the Carolinas Richmond Memorial Hospital in Rockingham.  They are also available in other areas of the state by appointment (855-733-3711).

Researchers from the University of North Carolina’s NC Rural Health Research Program announced in mid-October that Robeson County – the largest county in the state by land area, and a predominately low-income, rural county – had the highest percentage of eligible residents enroll through the exchange during the 2014 open enrollment period that ended in April.  49.9 percent of the county’s eligible residents enrolled, highlighting the importance of grass-roots efforts on the part of navigators and advocacy organizations.

Grandmothered plans can renew again

North Carolina accepted President Obama’s proposal that individual policies slated for termination at the end of 2013 be renewed into 2014, and then allowed to renew again up until 2016.  Last fall, about 120,000 people with Blue Cross and Blue Shield of North Carolina opted to keep their pre-2014 coverage, despite rate increases of at least 16 percent.

The carrier is allowing them to do so again for 2015 if they prefer that over selecting a new ACA-compliant plan.  Most of the 14 other carriers that allowed grandmothered plans to extend into 2014 are allowing them to renew again this fall, so there should be very few involuntary policy cancellations in North Carolina as we head into 2015.

Exchange history and legislation

North Carolina’s path towards ACA implementation was a complicated one that covered all bases.  The state took official actions toward each one of the options for a health insurance marketplace: state-run, partnership, and federally operated. In June 2011, North Carolina passed a law stating an “intention” to develop a state-run health insurance exchange.

The House at one point authorized a state-run exchange, but the Senate did not. Outgoing Gov. Bev Perdue announced in November 2012 that the state would partner with the federal government to run the marketplace. Finally, new Gov. Pat McCrory announced in February 2013 that North Carolina would default to the federal marketplace.

Hands-off approach from state leaders

While the federal government is running the marketplace in North Carolina via, the state department of insurance reviews the rates proposed by insurers who want to sell policies in North Carolina through the federal exchange.  Much to the dismay of state Insurance Commissioner Wayne Goodwin, this is the only involvement that the state has with the exchange.

North Carolina also rejected federal funds to expand Medicaid, although Governor McCrory said in late October 2014 that he’s “trying to figure out what to do with Medicaid and whether to expand that or not… [he’s] doing that assessment right now.”  By December, the issue was still up in the air, with Republicans in the state legislature generally opposed to expanding Medicaid, while state leaders grapple with the idea that if they don’t expand Medicaid, the state will continue to miss out on significant federal tax funding.

As of mid-January, there was still no consensus among lawmakers and the Governor, but the issue is still up for possible consideration during the current legislative session.

Young adults in North Carolina are disproportionately impacted by the state’s refusal to expand Medicaid.  258,000 people age 18 – 34 are in the coverage gap, meaning they are ineligible for Medicaid, but their incomes are too low to qualify for subsidies in the exchange (exchange subsidy eligibility starts at the poverty level – people living below the poverty level are not eligible for subsidies, because under the ACA, they were supposed to have access to Medicaid).  In all about half a million North Carolina residents are in the coverage gap.

Support for the ACA in North Carolina is relatively low, no doubt a result of the clear opposition to the law voiced by the state’s leaders.  The state is not doing any marketing or outreach to explain the insurance marketplace to state residents. Instead, the federal government and insurers themselves have taken on that responsibility. Blue Cross and Blue Shield of North Carolina currently dominates the individual insurance market in the state, and the organization is taking a lead role in promoting the marketplace. Its outreach efforts include operating retail stores and taking a trailer to fairs, farmers markets, and other community events across the state.

Private exchanges launched

The marketplace for small businesses is very limited, with only Blue Cross and Blue Shield of North Carolina participating in the SHOP exchange.  In a move that could hinder the success of the official exchange, the North Carolina Chamber of Commerce launched its own private health insurance exchange in mid-October, designed to appeal to workers whose employers stop offering health insurance coverage (the Chamber expects a lot of this, but it remains to be seen whether this will be a significant issue going forward or not).

The Chamber exchange will not be affiliated with the state’s official health insurance exchange, and consumers should be aware that no premium or cost-sharing subsidies are available for plans purchased outside of the official exchange.

In June, after the first open enrollment period for individual health insurance had ended, Blue Cross Blue Shield of North Carolina announced that it was creating a private single-carrier exchange for employers with at least 50 employees, and would add a private small group exchange later this year.

North Carolina health insurance exchange links

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

North Carolina Institute of Medicine (NCIOM)

Health Insurance Smart NC
Assists people insured by private health plans, Medicaid, or other plans in resolving problems pertaining to their health coverage; assists uninsured residents with access to care.
Toll free: 1-877-885-0231

Managed Care Patient Assistance Program
Serves consumers who are members of managed health benefit plans.
(919) 733-6272 / Toll-Free: 1-866-867-6272 (in North Carolina only)

Community Care of North Carolina

Legal Aid of North Carolina (855-733-3711)