Alaska health insurance

Down to 1 carrier, AK moves to prevent double-digit rate hikes

Alaska had reason for concern that their already high healthcare costs would skyrocket when Moda confirmed its exit from the state’s individual market at the end of 2016, leaving a single individual health insurance carrier remaining. However, the state has stepped in to prevent such a scenario. In July 2016, Governor Bill Walker signed H.B.374 into law. A two-year program, H.B. 374 uses an existing assessment that is currently sent to the general fund and redirects it to a reinsurance fund for the individual market. In the meantime, Alaska lawmakers will work to develop a permanent solution.

In 2016, Alaska’s health insurance rates were the highest in the country, with benchmark premiums for a 40-year-old in a major metropolitan area averaging $719. Premera requested an average rate increase of 7.3 percent – that increase was approved. As such, those currently insured by Moda, which tends to have lower rates, will see their premium costs go up when they switch to Premera plans for 2017.

Alaska health ratings

Alaska ranks in the middle of the pack in several nationwide rankings of public health status. The state known as The Last Frontier placed 32nd in The Commonwealth Fund’s 2015 Scorecard on State Health System Performance. In this particular ranking, Alaska’s uninsured rate lowered its performance, placing 46th for adults and 48th for children. Furthermore, it took 51st for the number of at-risk adults without a routine doctor visit in the past two years.

Review Alaska’s scorecard for a more comprehensive look at the factors that determine these rankings.

America’s Health Rankings (2015 edition) puts Alaska slightly higher at 27th. Alaska earned strong marks for high per capita health funding (#1) and its number of dentists (#2). Yet, again, lack of health insurance was among its worst-performing measures (47th).

Another source for public health indictors and comparisons among the states is Trust for America’s Health. Check out its compilation of Key Health Data About Alaska.

If you want to take zero in on a particular area within Alaska, check out county-level rankings for Alaska. This data was compiled by the Robert Wood Johnson Foundation and the Population Health Institute at the University of Wisconsin.

Obamacare’s impact on Alaska

While the ACA is credited with a sharp decline in the uninsured rate across the nation, the impact in Alaska started out more modest. Alaska’s uninsured rate dropped 2.8 percent during 2014 open enrollment, from 18.9 percent to 16.1 percent.

However, the state soon made up for its slow start. By late 2015, Alaska ranked 7th among the 10 states with the greatest reduction in uninsured. In 2013, Alaska’s uninsured rate was 18.9 percent; by 2015, it was 10.3 percent – down 8.1 percentage points. In the same timeframe, the nation’s uninsured rate fell to 11.7 percent.

2017 rates and carriers for Alaska’s exchange

Alaska’s two individual market carriers have struggled under the Affordable Care Act, and one has decided to exit the individual market completely at the end of 2016. Moda will continue to offer individual dental pans as well as group medical coverage; however, the 14,000 Alaskans enrolled in the company’s on- and off-exchange individual health insurance plans will need to switch.

Premera will be Alaska’s only carrier offering health insurance during 2017 open enrollment, unless another carrier joins before November 1. Alaska’s health insurance rates are higher than anywhere else in the country. As Alaska’s sole exchange carrier, Premera was set to raise rates by at least 40 percent in order to cover claims costs.

As a means to stopping an impending “death spiral,” Alaska Governor Bill Walker signed H.B. 374 into law in July 16. This two-year program will utilize a reinsurance fund to cover claims for high-cost insureds in the individual market as lawmakers work to develop a permanent solution.

On the same day Gov. Walker signed H.B. 374 into law, Premera announced they had filed their 2017 rate proposal, requesting an average increase of 9.8 percent. One month later, it filed a new rate proposal, which requested an average rate increase of 7.3 percent; that proposal was approved.

Alaskans enrollment in qualified health plans

The Kaiser Family Foundation estimated in the fall of 2013 that about 78,000 Alaska residents would be eligible to enroll through the marketplace and that about 70 percent would qualify for premiums subsidies. However, just 12,890 people signed up for qualified health plans (QHPs) through Alaska’s health insurance exchange during the 2014 open enrollment period. Among those who did enroll in a QHP, 88 percent qualified for financial assistance, compared to 85 percent nationally according to the U.S. Department of Health and Human Services (HHS).

By March 31, 2016, Alaska’s effectuated enrollment was 17,995. Of those remaining enrollees, 90 percent were receiving premium subsidies.

Alaska and the Affordable Care Act

Alaska’s three-member U.S. Congressional delegation voted 2-1 against the Affordable Care Act, which was signed into law in 2010. Sen. Mark Begich, a Democrat, was alone in supporting the ACA. Sen. Lisa Murkowski and Rep. Dan Young, both Republicans, voted no. Former Gov. Sean Parnell opposed the overall ACA and spoke out strongly against a state-run exchange.

Sen. Dan Sullivan, a Republican who has talked about the need to repeal and replace Obamacare, defeated Begich in the 2014 election.

Alaska is the only state that did not to apply for the $1 million exchange-planning grant that was available from the federal government. State legislators considered a state-run exchange in the 2011 and 2012 sessions, but didn’t pass a bill either year. Parnell announced in July 2012 that the state would default to the federally facilitated exchange.

Initially, Alaska did not adopt Medicaid expansion. Governor Bill Walker, an Independent, took office on December 1, 2014, and announced his intention to expand Medicaid within his first 90 days in office. Though it took a little more time, he succeeded and the state expanded Medicaid on September 1, 2015.

New governor expands Medicaid

Alaska decided against Medicaid expansion for 2014, and a Kaiser Family Foundation study estimated 30,000 Alaska residents are excluded from coverage as a result. The same study estimated that 17,000 Alaska residents are in the Medicaid coverage gap – meaning they don’t qualify for Medicaid (e.g., they are a childless adult or exceed income threshold), yet they don’t make enough to qualify for federal subsidies that would help them purchase individual coverage through the marketplace.

Those left out of Medicaid coverage in 2014 faced brighter prospects in 2015. Gov. Bill Walker took office on Dec. 1, 2014, and made Medicaid expansion a priority in his first months. Walker’s administration is explored whether the governor could proceed through an executive order or if legislative action is needed to authorize expansion. Walker’s administration had set a July 2015 target for having Medicaid expansion in place. However, they faced budget challenges and problems with the state’s existing Medicaid systems technology. Lawmakers rejected Medicaid expansion in the state budget, and the 2015 legislative session ended without a vote on the Medicaid expansion bill.

On July 16, 2015, Walker used his executive authority to expand Medicaid on his own, noting that he had run out of options. Alaska Medicaid expansion took effect September 1. Within a month of the expanded guidelines taking effect, 2,000 people enrolled Alaska Medicaid.

Alaska Medicare enrollment has grown by 28 percent since the ACA took effect. In 2013, average monthly enrollments were 122,334; by June 2016, they reached 156,409

Visit the Alaska Department of Health and Social Services to learn about Medicaid and CHIP in Alaska.

Does Alaska have a high-risk pool?

Before the ACA reformed the individual health insurance market, coverage was underwritten in nearly every state, including Alaska. This meant that medical history was an important component in eligibility for a private individual plan, and people with pre-existing conditions often found themselves unable to purchase coverage, or only able to get a policy that excluded pre-existing conditions.

The Alaska Comprehensive Health Insurance Association (ACHIA) was created in 1993 to give people an alternative if they were unable to obtain individual health insurance because of pre-existing conditions.

As a provision of the ACA, all new health insurance policies became guaranteed issue starting on January 1, 2014. This reform largely eliminated the need for high-risk pools, but as of August 2016, the ACHIA website stated that the pool will remain open through at least the year’s end.

Medicare enrollment in AK

Alaska Medicare enrollment reached 83,863 in 2015, about 11 percent of the state’s population. Nationwide, 17 percent of the population is enrolled in Medicare.

Historically, 84 percent of Alaska Medicare recipients qualify for coverage based on age alone, whereas the other 16 percent are on Medicare as the result of a disability. These numbers match national averages.

Medicare pays about $6,412 per enrollee in Alaska each year, and as of 2009, the state ranks 51st in overall spending with $553 million annually.

Alaskans that want additional benefits beyond what original Medicare offers can select a Medicare Advantage plan instead. Less than 1 percent of Alaska Medicare recipients make this choice, compared with 31 percent of all Medicare recipients.

However, 40 percent of Alaska Medicare enrollees select Medicare Part D plans, which provide stand-alone prescription drug coverage. Of all U.S. Medicare recipients, 45 percent have stand-alone Rx plans.

State-based health reform legislation

Here’s a summary of what’s happening at the state level in Alaska with regard to healthcare reform: