Delaware’s exchange is a partnership between the state (Choose Health Delaware) and HHS, with residents enrolling through Healthcare.gov. There are only two carriers offering plans in the individual marketplace, and the weighted average rate increase for 2016 is nearly 22 percent. But premium subsidies will offset much of the rate hike for the 84 percent of Delaware exchange enrollees who are receiving subsidies.
On September 29, Delaware Insurance Commissioner Karen Weldin Stewart announced final rates for 2016, after vowing earlier in the year that the Insurance Department in Delaware would “vigorously examine” the 2016 rate proposals they received from the state’s two exchange insurers, hoping to find ways to reduce the final rates.
Highmark Blue Cross Blue Shield of Delaware initially requested an average rate increase of just over 25 percent in the individual market, although they increased their proposed rate increase to 33 percent in August. State regulators ultimately approved a 22.4 percent average rate increase for Highmark’s individual market plans, but Highmark has almost 95 percent of the individual market share in Delaware, including both on and off-exchange enrollments.
Aetna proposed raising rates by an average of 16 percent for 2016, which was approved by regulators.
In 2014, Highmark garnered more than 90 percent of the exchange market share, and as of the end of January 2015, Highmark had nearly 30,000 individual enrollees in Delaware, including the off-exchange market. For 2015, they proposed a rate increase of 5 percent, but ended up reducing it to 4 percent instead. It’s possible that the sharper increase in Highmark premiums for 2016 could result in a shake-up of the market share in Delaware, but Aetna’s rate increase is also relatively high, at 16 percent.
It will be important for enrollees to shop around during open enrollment and see if a different plan might present a better value for 2016 (the nearly 22 percent weighted average rate increase assumes that everyone keeps their existing plan in 2016). But since average rates are increasing on all of the plans sold in the Delaware exchange, premium subsidies will also be higher in 2016, and will mitigate much of the premium increase for the 84 percent of enrollees who are receiving subsidies.
Delaware’s Insurance Commissioner is in ongoing talks with other insurance carriers in an effort to add carriers to the Delaware marketplace in future years and increase competition and options for the state’s consumers.
Delaware opts to stay with federally-run exchange
In the months leading up to the Supreme Court’s ruling on King v. Burwell, Delaware devised a back-up plan. Because Delaware uses the federally-run marketplace (the state has a partnership exchange, which is a variation of the federally-run exchange), subsidies were in jeopardy in the state. If the King plaintiffs had prevailed, ACAsignups estimated that 18,000 people would have lost their subsidies in Delaware. And state-wide, the entire individual market would have seen spiraling premiums over the next few years as healthy individuals dropped coverage that became unaffordable without subsidies.
To avoid that outcome, the state submitted a proposal for transitioning from a state-federal partnership exchange to a federally-supported state-based marketplace (Oregon, Nevada, and New Mexico currently use that model, with state-run exchanges that utilize Healthcare.gov for enrollment; Hawaii is in the process of becoming a federally-supported state-based marketplace). And on June 15, HHS issued conditional approval for Delaware’s plan (Pennsylvania and Arkansas also got conditional approval for state-run exchanges as contingency plans in case the Court had sided with King).
Delaware is the only Democratic-controlled state that doesn’t have a state-run exchange, in large part because the state’s small population would make it financially difficult to sustain an exchange.
On June 25, the Supreme Court ruled that subsidies are legal in every state, including those that use the federally-run marketplace, which meant that subsidies will continue to be available in Delaware regardless of whether the state runs its own exchange. Initially, it was unclear whether Delaware would continue with their plan to implement a supported state-based marketplace. The state issued a press release immediately after the King verdict was announced, stating that they would continue to evaluate the possibility of transitioning the exchange, and make a decision later in the summer.
But in August 2015, Delaware officials announced that they would continue to operate as a state-federal partnership exchange, noting that it would be more cost-effective than operating their own exchange.
Nearly 25,000 Delaware residents signed up for a qualified health plan on HealthCare.gov between Nov. 15, 2014, and Feb. 15, 2015. According to Kaiser, 52 percent of the state’s potential pool of 48,000 individuals signed up for coverage.
Some enrollees didn’t pay their initial premiums though, and some opted to cancel their coverage early in the year. By the end of March, effectuated enrollment through the Delware exchange stood at 22,397 people. Nationwide, effectuated enrollment declined during the second quarter of 2015, but in Delaware it increased. By the end of June, 23,163 people had in-force coverage through Delaware’s exchange. 84 percent of them are receiving premium subsidies, and 44 percent are receiving cost-sharing subsidies to reduce their out-of-pocket exposure.
Delaware official opted to expand Medicaid under the ACA, and Medicaid enrollment in the state has increased by 8 percent from 2013 to June 2015. But the overall uninsured rate in the state hasn’t shifted significantly, according to data from a Gallup survey. In 2013, the state’s uninsured rate was 10.5 percent (lower than average), but it had only dropped to 9.9 percent by mid-2015 (the decline is within the margin of error for the sample).
Opportunity to enroll
Open enrollment for 2015 has ended, but special enrollment periods are also open to consumers who experience a qualifying event, such as getting married or having a child. Individuals must enroll or make changes to their coverage within 60 days of the event. Enrollment for Medicaid continues throughout the year, and Native Americans can also enroll year-round.
Open enrollment for 2016 begins on November 1, 2015 and runs through January 31, 2016. If you aren’t covered in 2016, you may have to pay a penalty: $695 per adult/$347.50 per child or 2.5 percent of the household income, whichever is more. However, there are caps on the total amount and numerous exemptions. Use the calculator on healthinsurance.org to see if you’ll be penalized if you skip getting covered in 2016.
Plenty of help available from Choose Health Delaware
Delaware received a $600,000 federal grant to fund in-person assistance with 2015 enrollment, and received the same amount again in 2015 to fund enrollment assistance for 2016. Choose Health Delaware has marketplace guides available at more than 70 locations throughout the state, including hospitals and other healthcare facilities, libraries, state service centers, schools and college campuses, community agencies and churches. The exchange website includes a locator tool to help consumers schedule an appointment with a marketplace guide.
2015 insurers and rates
Two divisions of Aetna and Highmark Blue Cross Blue Shield are selling individual policies through the exchange for 2015. Plans being sold by Aetna were marketed as Coventry plans in 2014; Coventry was acquired by Aetna in 2013.
A study released in December 2014 by The Commonwealth Fund shows just a 3 percent increase in average marketplace premiums for Delaware between 2014 and 2015. The weighted analysis looked at rates across all metal tiers and in urban/suburban/rural areas of most states.
The Commonwealth Fund study found wide variations across the country. Ten states are experiencing double-digit increases, while 14 states are seeing double-digit decreases. For the nation, average premiums increased 0 percent — an amazing turnaround from the 10 percent or greater annual increases seen in the years immediately preceding the implementation of the Affordable Care Act.
How many people signed up in 2014?
According to Choose Health Delaware, 23,612 state residents enrolled in private insurance or Medicaid between October 2013 and November 2014.
During 2014 open enrollment, 81 percent of those enrolling in QHPs were eligible for premium subsidies. Among those who qualified for subsidies the average post-subsidy monthly premium was $130. That’s the third-highest average among states using the federal marketplace.
Delaware experienced a 0.9 point drop in its uninsured rate between 2013 and 2014, according to the Gallup-Healthways Well-Being Index. Delaware’s uninsured rate was 9.6 percent in 2014.
Delaware’s SHOP exchange
Delaware businesses with 50 or fewer employees can shop for health insurance online through the SHOP exchange on HealthCare.gov. However, enrollment expectation for the SHOP are modest.
Delaware delayed the launch of “employee choice” on the SHOP exchange, so it wasn’t available in 2015. Employee choice allows employees of small businesses that use the SHOP to select from a range of plans rather than being limited to a single plan selected by their employer. The federal government let states that use the federal marketplace choose if they want to implement employee choice for 2015. Delaware was one of 18 states that is delaying implementation of employee choice.
For 2016, Delaware regulators approved a 12.7 percent average rate increase for Highmark’s small business plans, but they also approved a 6.1 percent average rate decrease for Aetna’s small group plans.
Delaware’s marketplace approach
The state’s health insurance marketplace is branded as Choose Health Delaware, and it is operated in partnership with the federal government. Delaware is responsible for plan management and consumer assistance while the federal government handles all other functions.
Several states adopted a partnership exchange as an incremental step toward an eventual state-run exchange. However, Delaware chose the partnership model as a financially prudent approach given its small population. Delaware officials also expressed interest in a potential regional exchange, whereby the state would partner with one or more other states. A regional partnership would spread administrative cost over a wider population and increase the size of the risk pool.
Delaware health insurance exchange links
Choose Health Delaware
Health Benefit Exchange information
Exchange information from the Delaware Health Care Commission
State Exchange Profile: Delaware
The Henry J. Kaiser Family Foundation overview of Delaware’s progress toward creating a state health insurance exchange.