There is still plenty of room to expand health insurance coverage in the Sunshine State. According to US Census data, the uninsured rate in Florida was 20 percent in 2013, and 16.6 percent in 2014 – among the highest in the country both years. By mid-2015, a Gallup survey indicated that the uninsured rate had fallen to 15.2 percent.
With the third ACA open enrollment period underway, the South-Florida metro area (Broward, Palm Beach, and Miami-Dade counties) is being targeted by HHS for increased outreach and enrollment activities. The area still had an uninsured rate of 19.4 percent in 2014 (US census data) – far higher than the 10.4 percent national average at that point.
Cigna pulls out of exchange
Two weeks before the start of the third open enrollment period, Cigna announced that they would not offer plans in the exchange in Florida in 2016. They have about 30,000 enrollees in the Florida exchange, all of whom will need to secure coverage with a different carrier during open enrollment if they wish to continue to be insured in the exchange. Cigna will continue to offer plans outside the exchange, but no subsidies are available outside the exchange.
In August, when Florida regulators announced the approved rates for carriers in the state, Cigna was listed among the off-exchange carriers. I contacted the Florida Office of Insurance Regulation (FLOIR) to clear up the discrepancy – how could a carrier pull out of the exchange when they were already listed as only offering plans outside the exchange several weeks earlier?
FLOIR explained that in August, when the rates were being finalized, Cigna had already expressed concerns about their on-exchange business, and were still in the process of determining whether they would offer on-exchange plans in 2016. Of all the Florida carriers whose rates were finalized in August, Cigna was the only one where there was still uncertainty about whether they would offer plans in the exchange. So FLOIR listed them among the off-exchange carriers at that point, since the off-exchange market was the only one for which they were certain Cigna would participate.
In the weeks leading up to the start of open enrollment, there were carriers in several states that announced they would not participate in the exchanges for 2016. In most cases, the risk corridor payment shortfall was cited as a reason, but Cigna’s justification for leaving the exchange was somewhat unique: the carrier cited fraudulent billing by substance abuse clinics and labs in Florida. Cigna has said they didn’t realize how significant the fraudulent claims were until after the deadline to submit plans for 2016. Once they determined the scope of the problem, they made their decision to pull out of the exchange market for a year.
Cigna plans to re-enter the Florida exchange in 2017 with a new suite of plans available.
Open enrollment for 2016 began on November 1, 2015, and continues through January 31, 2016. After that, no plans for 2016 will be available for purchase without a qualifying life event that triggers a special enrollment period. However, Native Americans can enroll year-round, as can applicants who are eligible for Medicaid or CHIP.
2016 rates, now with oversight
For 2014 and 2015, Florida’s Insurance Commissioner was powerless to regulate proposed health insurance premiums, due to legislation signed into law by Governor Scott in 2013. But this summer, for the first time since ACA-compliant plans debuted, Insurance Commissioner Kevin McCarty has the ability to challenge rates proposed by health insurance carriers.
19 individual market carriers in Florida submitted proposed rates for 2016 ACA-compliant plans, although ten of them (including Cigna) only offer plans outside the exchange for 2016. FLOIR has searchable rate filing data available on its site, but most of the carriers submitted their proposed rate hikes as “trade secrets” which means that they were not disclosed to the public unless they were above ten percent (Healthcare.gov’s rate review tool also only displays proposed rate hikes of ten percent or more).
But the details were revealed on August 26, when the FLOIR released final rates – along with the original proposals – for all 19 carriers. Just three of them had final approved rates the same as what they originally proposed. Of the remaining 16 carriers, final rates were lower than proposed for ten of them, and higher than originally proposed for the other six.
Ultimately, the weighted average approved rate increase in the individual market in Florida came out to 9.5 percent for 2016. For plans in the exchange, rate changes for 2016 vary from a decrease of 9.7 percent (Florida Health Care Plan, Inc.) to an increase of 16.4 percent (UnitedHealthcare of Florida, Inc.).
HHS released a report in October that showed average benchmark premium changes for 2016 (note that the benchmark plan is the second-lowest-cost Silver plan in a given area; it’s not necessarily the same plan from one year to the next). While changes in the benchmark premium are useful in terms of seeing how much subsidies will change, they’re not particularly useful from an individual insured’s perspective. But for what it’s worth, the average benchmark premium across Florida is increasing by just 1.2 percent in 2016. In the Miami-Fort Lauderdale metro area, it’s increasing by 2 percent.
The fact that the average benchmark premium is increasing by just 1.2 percent statewide means that subsidies will be just slightly higher in 2016 than they were in 2015. But overall premiums will be 9.5 percent higher. So as usual, it will be important for enrollees to actively shop around and compare available plans during open enrollment, rather than simply letting their plans auto-renew.
2015 enrollment numbers
Florida’s uninsured rate dropped to 15.2 percent in the first half of 2015, down from 22.1 percent in 2013. That’s certainly an improvement, although it’s still significantly higher than the 8.9 percent average uninsured rate in states that established their own exchanges and expanded Medicaid (Florida did neither).
Between Nov. 15, 2014, and Feb. 15, more than 1.6 million Florida residents selected a private health plan in the exchange. Florida had more people sign up for health insurance through its marketplace than any other state during 2015 open enrollment. Florida ranks fourth in population, behind California, Texas, and New York.
In just the first month of open enrollment, Florida exceeded projections for new enrollees in 2015. Officials last fall estimated that more than 1 million residents would sign up to have health insurance in 2015, including 206,000 people who were expected to enroll for the first time. Two months into open enrollment, about 546,000 new consumers had already enrolled.
Some enrollees didn’t pay their initial premiums however, and others opted to cancel their coverage early in 2015. By the end of June, effectuated enrollment in Florida stood at 1,314,890 people. And while attrition is a natural part of the individual health insurance market, plan selections have continued since the end of open enrollment, due to qualifying events and the tax season special enrollment period that Healthcare.gov offered during the spring.
From February 23 to June 30, Florida led the nation in enrollments, with 160,828 people signing up for private coverage through the exchange. Almost half of them qualified for a special enrollment period due to losing other health insurance coverage, but more than 30,000 Florida residents enrolled as a result of the tax season special enrollment period. That means that they were uninsured in 2014, and found out about the penalty when they filed their tax return. Thanks to the special enrollment period, they won’t be on the hook for the full penalty in 2015 (which is significantly higher than it was in 2014).
Florida’s enrollment success is attributed to well-coordinated outreach, a competitive insurance market in key population centers, and the state’s decision against Medicaid expansion. In states that did expand Medicaid, those with income up to 138 percent of the federal poverty level (FPL) can enroll in Medicaid. Without that option in Florida, low-income residents (with incomes between 100 percent and 138 percent of poverty) are turning to the marketplace for coverage (those with incomes below 100 percent of the poverty level are in the coverage gap – they don’t qualify for Medicaid, nor do they qualify for subsidies in the exchange).
Florida the biggest winner in King v. Burwell
A lot was at stake in Florida in King v. Burwell. The plaintiffs argued that subsidies could only be provided by state-run exchanges, and since Florida uses the federally-run exchange (Healthcare.gov), 1.2 million people would have lost their subsidies in Florida if the Supreme Court had agreed with the plaintiffs. That’s more than any other state, by far – Texas has the second-highest number of subsidies on the line, at 805,000. But in June 2015, in a 6 – 3 ruling, the Court upheld the legality of the subsidies in every state, regardless of whether the state runs its own exchange.
That was obviously good news for the 1.2 million people in Florida who are receiving subsidies, but it was also good news for people who buy their own insurance without subsidies, since they would have seen rate increases of about 55 percent – in addition to regular annual rate increases – if subsidies and been eliminated. The entire individual insurance market would have been destabilized, and the Urban Institute estimated that the number of people covered by individual insurance would have dropped by 70 percent. Not only would that have been bad news for the insureds themselves, but it would also have been devastating to the insurers and medical providers in the state.
Unsurprisingly, Florida’s political leadership was mostly split along party lines in terms of their reactions to the Supreme Court’s ruling. But Senate President Andy Gardiner, a Republican from Orlando, expressed satisfaction with the outcome, noting that it preserved subsidies for 1.2 million people in Florida. He also used the ruling as an opportunity to remind people that hundreds of thousands of Florida residents are still caught in the coverage gap because the state hasn’t expanded Medicaid.
Florida Governor sues CMS
In April 2015, Floria Governor Rick Scott announced that his administration was suing CMS over funding for the state’s Low Income Pool (LIP) program. Florida is one of 20 states that has not yet expanded Medicaid, and had the fifth-highest uninsured rate in the country in 2014. The LIP program got about $2.1 billion in federal dollars in 2015, but funding had long been scheduled to end on June 30, 2015.
Scott sued CMS because the agency refused to renew Florida’s LIP funding, and Scott’s administration saw this as coercion to try to get them to expand Medicaid (Scott famously flip-flopped on the issue of Medicaid expansion).
Florida wins the battle, temporarily
In May, CMS notified Scott’s administration that Florida could still qualify for $1 billion in LIP funding for the 2016 fiscal year, although the state will need to resubmit its proposal and budget for 2016 in order to obtain the funding. The letter from CMS included a warning that for the 2017 fiscal year, LIP funding will drop to $600 million, and that there is no provision for funding starting in June 2017.
On June 25, Gov. Scott announced that he was withdrawing his lawsuit against CMS. But for the work that was already done, the suit cost Florida taxpayers $175,000. Earlier in the week, Scott had reached an agreement with CMS to accept the $1 billion in LIP funding for the 2016 fiscal year, but lawmakers will have to revisit the issue of LIP funding when they reconvene in 2016, as the funding will decrease in mid-2016. One condition in the CMS agreement to provide continued LIP funding is that it cannot be used for expenses that would have otherwise been covered if Florida had agreed to accept $50 billion for Medicaid expansion.
As part of the agreement over the LIP funding, Florida will use $400 million in state funds to increase Medicaid provider reimbursement rates, and that generates an additional $600 million in federal matching funds from CMS. Combined with the $1 billion in LIP funding for the 2016 fiscal year, the total pool of money to fund hospital indigent care is still at about $2 billion, the same as it was during the 2015 fiscal year.
Until Florida expands Medicaid, there will still be 567,000 people in the state with no access to Medicaid or premium subsidies. And in theory, Florida would need far less money for the LIP program if they were to expand Medicaid, as Medicaid expansion would mean fewer uninsured residents and thus less uncompensated care at Florida’s hospitals. This is the reason that Disproportionate Share Hospital (DSH) payments are also being phased out.
Lawmakers went into overtime to work out a budget
The issue of Medicaid expansion and LIP funding made the 2015 legislative session extremely contentious in Florida, and the session ended with no agreement on a budget for the upcoming fiscal year. The House is opposed to Medicaid expansion and supported Scott’s lawsuit against CMS, while the Senate has offered an alternative to Medicaid expansion known as the Florida Health Insurance Affordability Exchange Program (FHIX).
In June, the Senate approved FHIX (Senate Bill 2) with a 33 to 3 vote. But the House defeated it, with a 72 to 41 vote. FHIX would have used the state’s existing Florida Health Choices exchange (more details below) to provide heavily subsidized coverage for people with income between 22 percent and 133 percent of the poverty level, using Medicaid expansion funding.
A special legislative session to address the budget convened on June 1, 2015, and lawmakers showed a willingness to work together during the special session. The legislature needed to pass a budget by July 1 in order to keep the government running, and they came to an agreement after a few weeks of work. Gov. Scott signed the budget on June 23.
No expansion, but Medicaid enrollment grows
Despite the fact that Florida has not expanded Medicaid under the ACA, enrollment in the program continues to grow. The state has estimated that for the 2016 fiscal year that began on July 1, 2015, Florida’s Medicaid program will cover 4 million people, which represents a 6.6 percent increase over the 2015 fiscal year. Enrollment stood at 2.2 million a decade ago, and was at nearly 3.6 million by August 2015.
Florida will miss out on $66 billion in federal funding from 2013 to 2022 if it continues to reject Medicaid expansion. If the state does expand Medicaid, the federal government will pay the full cost of expansion for 2016, and the state’s portion will gradually increase to ten percent by 2020, remaining at that level going forward.
Florida’s other exchange
Florida Health Choices is the state’s own version of an online marketplace. While Florida Health Choices was established by 2008 legislation sponsored by Florida House Speaker Marco Rubio, it faced many delays and did not go live until March 2014.
Florida Health Choices initially offered “discount only” plans for some health services, such as dental services and prescription drugs. These plans were not true health insurance, and consumers largely ignored the state-sponsored exchange. Just 49 people purchased plans through Florida Health Choice during 2014.
In early January 2015, Florida Health Choices began offering health plans that comply with the ACA and cover the ACA’s ten essential health benefits. Policies from four insurers were available in 2015: Assurant, Cigna, Humana, and UnitedHealthCare. For 2016, Assurant has exited the health insurance market nationwide, but Cigna, Humana, and UnitedHeathcare will continue to offer plans through Florida Health Choices (Cigna has exited the Healthcare.gov exchange, but will continue to participate in Florida Health Choices, which is technically “off-exchange”).
Consumers who shop on Florida Health Choices can NOT obtain subsidies to help them pay for coverage. Those subsidies are available only through HealthCare.gov, the federally facilitated marketplace. As of June, more than 91 percent of Florida residents who had in-force coverage through Healthcare.gov were receiving premium subsidies.
During the 2015 open enrollment period, 42 people bought health insurance plans through Florida Health Choices. By mid-April, it had 80 paying customers. In his newly-minted presidential campaign, Marco Rubio has distanced himself somewhat from Florida Health Choices, not mentioning it in his plans for repealing and replacing Obamacare.
By August 2015, enrollment in Florida Health Choices had reached 150 people, and is reaching out to Realtors and professionals licensed by the state of Florida, offering them coverage through dedicated private exchanges. Naff notes that Florida Health Choices is aimed at people who earn too much money to qualify for premium subsidies, since those can only be obtained through Healthcare.gov in Florida. But Naff explains that Florida Health Choices can also help people enroll in Healthcare.gov if their income makes them subsidy-eligible.
2015 premiums up 7 percent
A Commonwealth Fund analysis shows Florida marketplace premiums increased 7 percent on average compared to 2014 rates. Nationally, premiums were flat from 2014 to 2015; however, that average masked double-digit increases in some states and double-digit declines in others.
The same analysis found average monthly premiums for a 40-year old nonsmoker in Florida for 2015 were:
- $303 for bronze plans
- $369 for silver plans
- $419 for gold plans
- $487 for platinum plans
Florida officials and the Obama administration argued over the trend for 2015 premiums during the summer of 2014. Florida insurance regulators said 2015 premiums for individual and family coverage would rise 13.2 percent on average. That figure was a weighted average based on projected enrollment in the various plans. In contrast, the Obama administration projected average premiums would drop four percent. The decrease was based on an evaluation of the second-lowest silver-level health plan, which is the benchmark for premium subsidies.
2015 participating insurers
Florida residents have an extensive number of health insurers to choose from on the federal marketplace. In total, 14 companies offered policies through the marketplace for 2015. Four of the insurers were new to the marketplace for 2015, according to Health News Florida.
Participating marketplace insurers for 2015 included Aetna, Blue Cross Blue Shield of Florida, Cigna, Coventry Health Care of FL, Florida Health Care Plan, Health First Health Plans, Health First Insurance, Health Options, Humana, Molina Healthcare of Florida, Preferred Medical Plan, Sunshine State Health Plan, Time Insurance Company, and UnitedHealthCare of Florida. Time announced in June 2015 that they would exit the health insurance market nationwide and are not offering plans for 2016. Cigna also announced in October 2015 that they would not offer plans in the Florida exchange in 2016.
2014: highest enrollment for states using HealthCare.gov
Florida had the highest 2014 enrollment among states using HealthCare.gov and the fourth highest percentage of eligible individuals using the marketplace to purchase affordable health insurance. With 983,775 people signing up for coverage, Florida lagged only California in the number of individuals selecting a qualified health plan (QHP) during the 2014 open enrollment period.
Florida exchange background
Florida staunchly opposed the Affordable Care Act and the development of an ACA-compliant health insurance marketplace. Florida legislators not only failed to approve legislation to create an exchange in Florida, they returned a $1 million federal planning grant awarded in 2010. And right after the Supreme Court ruling that upheld most of the Affordable Care Act in June 2012, Republican Gov. Rick Scott announced that Florida would not establish a state-based health insurance exchange.
Florida also made it more difficult for navigators to assist consumers in using the marketplace. In 2013, Florida passed a law requiring fingerprinting and background checks for anyone who wanted to serve as a navigator. The state requirements were in addition to federal requirements for 20 hours of training and a qualification test. Also in 2013, the Florida Department of Health (DOH) banned navigators from all county public health facilities. Florida DOH officials said the move was consistent with its policy of blocking outside groups not doing state business. They have also said the ban helps protects consumers from privacy concerns stemming from the collection of personal information for inclusion in a federal database. The Obama administration strongly criticized the ban on navigators, labeling the order “obstructionist” and “plain absurdity.”
Florida health insurance exchange links
State Exchange Profile: Florida
The Henry J. Kaiser Family Foundation overview of Florida’s progress toward creating a state health insurance exchange.
Florida Health Choices
State exchange established independent of the Affordable Care Act
Florida Office of Insurance Regulation
Assists consumers who have purchased insurance on the individual market or who have insurance through an employer who only does business in Florida.
(1-877-693-5236) / Out of State: (850) 413-3089
Subscriber Assistance Program – Agency for Health Care Administration
Serves residents enrolled in managed care; helps resolve grievance between managed care entities and their subscribers.
1-888-419-3456 (toll-free nationwide)