Montana health insurance marketplace guide 2023

Montana uses the federally run exchange at HealthCare.gov.

Montana’s legislature not only failed to authorize a state-run exchange, it also passed a bill in 2011 to prohibit the creation of an insurance exchange in Montana.

While Democratic Gov. Brian Schweitzer vetoed that bill, neither he nor Monica Lindeen, who was then serving as the state auditor and insurance commissioner, were able to generate legislative or public support for an exchange. So Montana residents use the federally-run HealthCare.gov as their exchange. (There are 32 other states that also use HealthCare.gov; the states that run their own exchange are the minority.)

Under the federal model, most aspects of the exchange are managed by the federal government. However, states can retain control of “plan management” functions, and Montana opted to do so. The Insurance Commissioner’s office regulates plans that operate on the exchange, as it does for plans sold outside the exchange.

The open enrollment period for individual/family health coverage runs from November 1 to January 15 (this window applies to plans purchased through the exchange as well as plans purchased directly from an insurance company). Outside of open enrollment, a qualifying event is necessary to enroll or make changes to your coverage.

If you have questions about enrollment, you can learn more in our comprehensive guide to open enrollment and our comprehensive guide to special enrollment periods.

For 2023 coverage, there are three insurers that offer exchange plans in Montana:

• Blue Cross Blue Shield of Montana
• Montana Health CO-OP
• PacificSource

All three insurers offer coverage statewide.

Insurer participation in Montana’s exchange has been remarkably stable since the exchange opened for business in 2014. There are three insurers that have offered plans statewide each year: Blue Cross Blue Shield of Montana (Health Care Service Corporation), PacificSource, and Montana/Mountain Health CO-OP (the state requires participating insurers to offer coverage statewide). Most states have seen fluctuation in terms of insurer participation in their markets and Montana’s has been quite steady.

Time briefly joined the exchange in 2015, although their parent company, Assurant, subsequently announced that they would exit the insurance market nationwide at the end of 2015, and would no longer offer coverage in 2016. As of June 2015, there were 7,283 Montana residents who had individual coverage from Time; all of them had to select replacement policies for 2016.

Only a small fraction of the states did not lose any carriers in their exchanges in 2017, and Montana was among them. But although there were still three participating insurers in 2017, plans were only available for purchase from BCBSMT and PacificSource from December 22, 2016 until July 2017, due to an enrollment freeze for Montana Health CO-OP.

People who purchased Montana Health CO-OP plans before December 22, 2016 had coverage from the CO-OP throughout 2017. But the CO-OP limited their enrollment for 2017 (some carriers in other states did this too, including Medica in Minnesota and Kansas), and the following message began appearing in December 2016 when visitors arrived at their website:

“Montana Health CO-OP will accept no new enrollments for 2017 after the evening of December 22. We are halting new enrollments because of the large number of new members for 2017. Thank you to all our 10,000+ new members!”

From December 23 through the end of January 2017 (the remainder of open enrollment), enrollees in Montana were able to select from Blue Cross Blue Shield of Montana, and PacificSource. And that was also true for people signing up during special enrollment periods until July 2017.

But the enrollment freeze was lifted in July 2017 — ahead of schedule. Montana Health CO-OP had originally planned to start offering coverage as of November 2017 (ie, during open enrollment, for coverage effective January 2018). But as of mid-July, the CO-OP website said “MHC is now accepting special enrollments off exchange. On-exchange special enrollments to begin soon! (off exchange means plans purchased directly through the CO-OP, as opposed to via HealthCare.gov) A representative confirmed by phone that the CO-OP had recently received regulatory approval to begin selling plans again, and indicated that on-exchange plans would be available by late July, for effective dates starting in September. As is the case nationwide, enrollments outside of open enrollment are contingent upon having a qualifying event, but people with qualifying events could select Montana Health CO-OP plans with effective dates of September – December. And as of November 1, 2017, CO-OP plans became available during the regular open enrollment period for coverage effective January 1, 2018.

The enrollment freeze did not apply to small group plans, which are available year-round.

Montana Health CO-OP has also expanded into neighboring Idaho and Wyoming over the last several years, with the Wyoming expansion new as of 2021.

The same three insurers — Blue Cross Blue Shield of Montana, PacificSource, and Montana Health CO-OP — continue to offer plans in Montana’s exchange as of 2022, and residents in all areas of the state can select from among all three insurers’ plans.

Montana’s individual/family health insurers have implemented the following average rate changes for 2023:

• Blue Cross Blue Shield of Montana (Health Care Service Corporation, or HCSC): 9.8% increase
• Montana Health CO-OP: 4.39% increase
• PacificSource: 15.8% increase

Overall, the weighted average rate increase is about 9.6% for 2023, which is slightly higher than the insurers initially proposed (the CO-OP had initially proposed an average rate increase under 3%, so their slightly larger final rate change pushed the overall average a little higher). 

It’s important to remember that average rate changes don’t tell the whole story, for several reasons:

• The reported average rate changes apply to full-price plans, and very few enrollees pay full price; most receive premium subsidies that offset a significant portion of the cost. For subsidized enrollees, net annual rate changes will also depend on how their premium subsidy amount is changing (which depends on the cost of the benchmark plan, as well as the enrollee’s projected income for the coming year). Fortunately for exchange enrollees, the Inflation Reduction Act has extended the American Rescue Plan’s temporary subsidy enhancements through 2025. This means that subsidies will continue to be larger than they used to be, keeping coverage much more affordable than it would otherwise have been.
• Even weighted average rate changes (calculated based on current enrollment) can’t account for the fact that people switch plans during the open enrollment period.
• Overall average rate changes do not account for the fact that premiums increase with age. A person who has individual market coverage for several years will continue to pay more each year — just due to their increasing age — even if their health plan’s overall average rate change is 0% during that time.
• A weighted average, by definition, lumps all the plans together. But different insurers offer plans in each region, and each insurer’s rate change is different. So the specific rate change that applies to a given enrollee can vary quite a bit from the average.

For perspective, here’s a look at how premiums have changed in Montana’s individual market in prior years:

• 2022: Average rate increase of 0.5%. Two insurers (BCBS of Montana and PacificSource) decreased their average premiums, but Montana Health CO-OP had a modest rate increase. Across all three insurers, the weighted average rate change was an increase of about half a percent. 
• 2021: Average rate increase of 1.4%. Across all three insurers in Montana’s individual market, the overall average rate increase amounted to about 1.4 percent. Initially, the insurers had proposed an average rate increase of about 3.1%. Although that was in the same general range as the average rate changes in many other states for 2021, Montana’s then-Insurance Commissioner, Matt Rosendale, noted that he considered any rate increase inappropriate for 2021 (Rosendale has since been elected to the U.S. House of Representatives). Rosendale’s position was that insurers shouldn’t have asked for a rate increase at all for 2021, given the profitability of insurers in the individual market in recent years and the reduced utilization of elective health care services during the COVID-19 pandemic. Montana’s insurance commissioner does not have the authority to block rate changes from taking effect. Montana’s insurance regulators can make recommendations to the insurers if they find that the proposed rates are not actuarially justified, but the insurers can implement those rate anyway if they choose to do so, as BCBSMT did in 2017 (note that the ACA’s MLR rules would require an insurer to repay consumers if more than 20% of premiums are spent on administrative costs, including profits). For 2021, however, two of Montana’s three insurers did agree to reduce their proposed 2021 rates after Rosendale told insurers that the initial proposals were unacceptable.
• 2020: Average rate decrease of 13.1 percent. Montana’s insurance commissioner announced that average premiums would decrease across the board in 2020 for plans sold in the individual market, with decreases ranging from 2 percent to 20 percent, depending on the plan. The state noted that about 65 percent of the total premium reduction could be attributed to the new reinsurance program (described in more detail below). So while premiums would likely have decreased even without the reinsurance program, the average decrease was much more significant thanks to the creation of the reinsurance program. But benchmark premiums dropped by an average of 14 percent, and premium subsidies — which are based on benchmark plan rates — were smaller than they were in 2019. So although average premiums decreased, that really only applied to people who pay full price for their coverage, which is about 15 percent of Montana’s exchange enrollees, in addition to everyone who buys ACA-compliant coverage outside the exchange.
• 2019: Average rate increase of 5.7 percent. The approved average rate increases ranged from 0 percent for Blue Cross Blue Shield of Montana to 10.3 percent for Mountain Health CO-OP. The rate increases for 2019 were almost entirely due to the elimination of the individual mandate penalty and the expansion of short-term health plans and association health plans. It’s noteworthy that Montana Health CO-OP — one of the four remaining ACA-created CO-OPs in the country — had taken over the top spot in terms of market share as of 2018 (in 2017, BCBSMT had more enrollees than the CO-OP). The week before the rate proposals were filed by insurers, Montana’s then-Insurance Commissioner Matt Rosendale — a strong critic of the ACA — wrote a scathing op-ed about how rates were likely to keep going up in 2019, and reiterating Rosendale’s position that “Obamacare has made a mess of our health insurance and health care systems.” But after the rates were filed, the commissioner’s office noted that the proposed rate increases for 2019 were modest. And rates would likely have decreased slightly if the individual mandate penalty hadn’t been eliminated, and if the Trump Administration hadn’t expanded access to short-term plans and association health plans.
• 2018: Average rate increase of 18.7 percent. The average rate increases ranged from 13.1 percent for PacificSource to 22.3 percent for Blue Cross Blue Shield of Montana. These rates included last-minute revisions to account for the loss of federal reimbursements for cost-sharing reductions (CSR). BCBSMT had the largest chunk of the market share in 2017, so the weighted average proposed rate increase was initially 14.14 percent (with BCBSMT including the cost of CSR in their 2018 premiums, but the other two insurers basing their rates on the assumption that federal CSR funding would continue). But the weighted average rate increase grew to 18.7 percent after the cost of CSR was added to Silver plans for Montana Health CO-OP and PacifiSource.
  When the 2018 rate proposals were being considered in 2017, the insurance companies that offered coverage in the state noted that — contrary to the popular GOP talking point — the Montana market was not in a death spiral. The rate hikes for 2016 and 2017 had a stabilizing impact, and the rate increase for 2018 would have been in the single digits if the Trump administration had not eliminated federal funding for cost-sharing reductions (CSR).
• 2017: Average rate increase of 47.6 percent. In the summer of 2016, when insurers filed proposed rates for 2017, all three carriers explained that their claims costs in 2015 far exceeded the premiums they collected, and that while there is pressure on carriers to lower their rates, they cannot do so unless healthcare providers agree to reduced rates as well. PacificSource’s average rate increase was 33.2 percent, and Mountain/Montana Health CO-OP’s average rate increase was 31 percent, both of which were determined to be justified by the Insurance Commissioner’s office. Blue Cross Blue Shield of Montana initially submitted an average rate increase of 62 percent, and ultimately settled on an average increase of 55.3 percent. Monica Lindeen, Montana’s Insurance Commissioner in 2016, noted that the proposed rate increase for BCBSMT was the highest she had ever seen in the state, and possibly the highest that had ever been requested in Montana. Ultimately, her team found BCBSMT’s final rate proposal of 55.3 percent to be unjustified, but they did not have the authority to block the rate increase from taking effect.
• 2016: Average rate increase of 25.9 percent. The average rate increases ranged from 22 percent to 34 percent. Although Montana’s insurance commissioner does not have the authority to deny rate proposals, then-Insurance Commissioner Monica Lindeen had an outside actuary review proposed rates, in an effort to get final rates as low as possible. And premium subsidies kept pace with increasing premiums: When plan selections for 2016 had been finalized, 83 percent of Montana exchange enrollees qualified for premium subsidies. Their average pre-subsidy premium is $421 per month, but their average after-subsidy premium is just $115 per month. That was actually one dollar per month lower than the average after-subsidy rate in Montana’s exchange in 2015, when 84 percent of Montana enrollees received subsidies. That year, their average pre-subsidy premium was $346 per month, but after subsidies, they paid an average of $116 per month.
• 2015: Average rate increase of 1.6 percent. Insurance Commissioner Monica Lindeen described the 2015 rate hike as “historically low”
• 2014: This was the first year that ACA-compliant plans were available, and premiums were essentially an educated guess, as there was no claims experience on which to base rates. Across all carriers, the lowest cost bronze plan in the Montana exchange averaged $251/month in 2014, which was very close to the national average of $249.

51,134 people enrolled in private individual/family plans through Montana’s exchange during the open enrollment period for 2022 coverage. That was the highest Montana’s exchange enrollment had been since 2017. Nationwide, enrollment for 2022 was a record high, although Montana’s exchange enrollment has not yet returned to the levels it was at from 2015 through 2017.

Here’s a summary of how enrollment has changed over the years in Montana’s exchange:

• 2014: The open enrollment period for 2014 coverage lasted for six months. During that window, 36,584 people enrolled in private plans through Montana’s exchange (another 4,638 people had qualified for Medicaid under pre-expansion guidelines; Medicaid expansion didn’t take effect in Montana until 2016).
• 2015: Total enrollment in private plans through the Montana exchange grew to 54,266 people.
• 2016: Enrollment grew again for 2016, when 58,114 people signed up during open enrollment.
• 2017: As was the case in the majority of the states that use HealthCare.gov, enrollment in Monana’s exchange dropped in 2017, when 52,473 people signed up during open enrollment.
• 2018: Enrollment dropped again in 2018, with a total of 47,699 people buying plans through Montana’s exchange during the open enrollment period for 2018 coverage. The reduced enrollment has to be considered in conjunction with the much shorter open enrollment period for 2018 coverage (half as long as previous years), and the fact that the Trump administration slashed the budget for marketing, outreach, and enrollment assistance in the weeks leading up to the start of open enrollment for 2018 coverage, after similarly cutting advertising and outreach in the final days of enrollment for 2017 coverage.
• 2019: 45,374 people enrolled.
• 2020: 43,822 people enrolled
• 2021: 44,711 people enrolled
• 2022: 51,134 people enrolled

In addition to on-exchange enrollments, nearly 35,000 people enrolled in Obamacare-compliant plans outside the exchange by mid-April 2014. But as of 2019, off-exchange enrollments had dropped to an estimated 15,000 people. Another analysis indicated that the off-exchange individual market in Montana had 28,261 enrollees in 2016, and only 13,372 by 2018.

One of the provisions of the ACA requires that carriers use a single risk pool for all of their individual plans in a state, so each carrier’s off-exchange enrollments are merged with its on-exchange enrollments for risk purposes — meaning that off-exchange enrollments are helpful in stabilizing rates. Inside the exchange, premium subsidies protect most consumers from the brunt of annual rate increases, but there is no such mechanism outside the exchange, and increasing prices over the years have made full-price plans less affordable, resulting in a sharp decrease in the number of people enrolled in full-price plans outside the exchange.