As of December 19, enrollment in private plans through the South Carolina exchange had reached 84,631 people, including new enrollees, active renewals, and most auto-renewals. This is virtually identical to the number of people who had in-force coverage through the exchange as of June 2015 (84,872). As of December 19, there were still six more weeks remaining in open enrollment.
Open enrollment continues through January 31. Plan selections made by January 15 will have coverage effective February 1, while plan selections made in the second half of January will have coverage effective March 1. If the exchange already auto-renewed your plan for January, you can still return to the exchange and select a different plan with a February or March effective date.
The penalty for being uninsured will be significantly higher in 2016 than it was in 2014 and 2015. Given the sharp increase in the penalty, many residents – particularly those who qualify for premium subsidies – will find that for the same amount of money, they could fund several months of health insurance premiums instead of paying a penalty that gives them nothing in return.
Coventry exits Kansas exchange
On October 22, Coventry announced that they would not participate in the exchange in Kansas in 2016. They are continuing to sell off-exchange plans, but Coventry Health and Life, as well as Coventry Health Care of Kansas, are not available to exchange shoppers during the current open enrollment period.
As of October 2015, about 45,000 people in the Kansas exchange had Coventry plans, which is more than half of the total exchange enrollment (total in-force enrollment stood at 84,872 people as of June 30).
Coventry attributed their decision to the risk corridor shortfall that was announced by HHS on October 1. Carriers that experienced high-than-expected claims in 2014 were supposed to receive risk corridor payments to offset their losses, and carriers with lower-than-expected claims were to pay into the risk corridor program. But Congress determined in late 2014 that risk corridors must be budget neutral, and the program ended up with only enough money to pay out 12.6 percent of the payments that were due to carriers across the country.
Three other carriers offered plans in the Kansas exchange in 2015, all of which operate under the Blue Cross Blue Shield umbrella:
- Blue Cross Blue Shield of Kansas City
- Blue Cross Blue Shield of Kansas
- Blue Cross Blue Shield Kansas Solutions.
But UnitedHealthcare joins
Although Coventry is no longer participating in the exchange, enrollees are still able to select from among four carriers, as UnitedHealthcare of the Midwest has joined the exchange for 2016. A check of plans available in several cities across Kansas indicates that there’s still a good mix of HMO and PPO plans available in most parts of the state, unlike some other states where PPO plans have become scarce.
2016 rate changes
Across the full individual and small group market in Kansas (including both on and off-exchange plans), proposed rate changes varied from a decrease of 0.4 percent, to an increase of nearly 38 percent. The Kansas Insurance Department warned that rate increases should be expected for 2016, but the rates that were approved were a little lower on average than the rates that carriers proposed. The average final rate changes across all five existing carriers range from a 9.4 percent increase to a 25.4 percent increase.
But those approved rate changes were finalized long before Coventry announced their exit from the exchange. The rate hikes for Coventry no longer apply, but more than half of the exchange enrollees in Kansas have had to select a new plan for 2016.
The majority of exchange enrollees in Kansas receive premium subsidies, which will offset a significant portion of the rate increases in 2016. This is contingent on consumers being willing to shop around during open enrollment however, as subsidies can change from one year to another if the price of the second-lowest-cost silver plan changes.
Statewide, the average price for the second-lowest-cost silver plan is increasing by 16.1 percent in 2016. That’s more than double the national average, and it means average subsidies will certainly increase in Kansas in 2016 – but not by enough to offset some of the higher rate hikes on Kansas plans. Shopping around is paramount, and enrollees who have let their plans auto-renew for 2016 can still return to the exchange and select a different plan (effective in February or March), as long as they do so by the end of January.
Subsidies safe for 66,000
The much-anticipated Supreme Court ruling on King v. Burwell was announced in June 2015, with the Court upholding the legality of premium subsidies for millions of Americans in states – like Kansas – where the federal government is running the exchange (Healthcare.gov). As of late June, there were 67,733 people receiving premium subsidies in Kansas; their coverage would have become unaffordable without subsidies.
Even those who currently pay full price for their health insurance would have seen dramatic rate increases if subsidies had been eliminated. The American Academy of Actuaries estimated that rates in the entire individual market in Healthcare.gov states would have increased by about 35 percent if the King plaintiffs had prevailed. And the Urban Institute put the figure even higher, predicting 55 percent rate increases market-wide if subsidies had been eliminated. And those are just the rate hikes that would have resulted from the elimination of subsidies… they would have been in addition to the normal annual rate increases based on medical cost growth.
Health and Human Services (HHS) reported 96,197 Kansans selected private health insurance through HealthCare.gov during 2015 open enrollment. According to estimates by Kaiser, about 39 percent of Kansans who were eligible to enroll via the marketplace in 2015 actually selected a health plan. The final 2015 open enrollment report shows that 52 percent of Kansas enrollees were new consumers. Twenty-six percent of Kansas enrollees were between the ages of 18 and 34; in all HealthCare.gov states, 28 percent of enrollees fell into the 18-to-34 bracket.
But by the end of March, the total number of people with in-force coverage through the Kansas exchange had dropped to 85,490, and it fell slightly lower by the end of June, to 84,872. Attrition is a normal part the individual health insurance market, as not all enrollees pay their initial premiums, and some insureds cancel their coverage for one reason or another (sometimes simply because they receive an offer of coverage from an employer instead).
Of the Kansas residents whose exchange coverage was in-force on March 31, just under 80 percent qualified for premium subsidies compared to 83.7 percent nationwide.
Special opportunities to enroll
Open enrollment for 2015 ended in February, but you can still get coverage for the remainder of the year if you experience a qualifying event, such as getting married, moving to a new area, having a baby, or losing other coverage. Native Americans or Alaska Natives can sign up for private coverage throughout the year. Enrollment for Medicaid and the Children’s Health Insurance Program (CHIP) is also open all year long.
Five insurers participating in 2015 exchange
Blue Cross and Blue Shield Kansas Solutions, an HMO and a subsidiary of Blue Cross Blue Shield of Kansas, joined the 2015 marketplace. The new entrant joins four other insurance companies that participated in the exchange in 2014: Blue Cross and Blue Shield of Kansas, Blue Cross of Kansas City, Coventry Life and Health, and Coventry Health Care of Kansas.
How much does insurance cost in 2015?
2015 premiums on the Kansas marketplace were up just 4 percent from 2014 rates, according to a comprehensive study completed by The Commonwealth Fund. Nationally, rates were flat. However, the zero percent average increase masked 10+ percent increases in 10 states and 10+ percent decreases in 14 states.
Below average enrollment in 2014
During the first open enrollment period, 57,013 Kansans enrolled in qualified health plans and nearly 14,000 people qualified for either Medicaid or the Children’s Health Insurance Program (CHIP) under existing eligibility criteria according to the Kaiser Family Foundation. In all, about one in five of those Kansans eligible signed up for private insurance — lower than the national average of 28 percent.
Among Kansas residents selecting a QHP, 85 percent qualified for financial assistance. Nineteen percent of Kansans selected a bronze plan (20 percent nationally), 60 percent selected a silver plan (65 percent nationally), 16 percent selected a gold plan (9 percent nationally), 2 percent selected a platinum plan (5 percent nationally) and 4 percent selected a catastrophic plan (2 percent nationally). Thirty-one percent of Kansas enrollees were between the ages of 18 and 34.
Kansas is the only state with a reported increase in the percentage of uninsured individuals between 2013 and 2014. The uninsured rate in Kansas rose from 12.5 percent to 14.4 percent according to a Gallup-Healthways poll. But both the full-year results and a mid-2014 poll that showed an even larger increase have been questioned by both Gallup and Kansas insurance experts. And by the first half of 2015, the Gallup data showed that the uninsured rate had ticked downward to 11.3 percent.
No Medicaid expansion
Kansas has not expanded its Medicaid program, which is called KanCare, despite a December 2013 poll that found 72 percent of registered Kansans voters favored expansion. While other Republican governors proceeded with Medicaid expansion, Gov. Sam Brownback remained opposed — as did the state’s Republican-controlled Legislature, which didn’t act on Medicaid expansion in 2014.
An Urban Institute report shows Kansas missing out on $5.3 billion in federal funding and hospitals losing $2.6 billion in Medicaid reimbursement.
The Kansas Hospital Association continues to advocate for expansion, touting a “Kansas solution” that includes cost-sharing provisions, high deductible plans, health savings accounts (HSAs) and other provisions that have been proposed or implemented in other conservative states.
Hospital officials have testified during state legislative committee meetings to explain the financial toll of the state’s decision against Medicaid expansion. Rural hospitals in particular are struggling because the Affordable Care Act is partly funded through a reduction in hospital payments from Medicare. In October 2015, Mercy Hospital in Independence, Kansas shut down, becoming the first Kansas hospital to close in nine years; the hospital’s demise has been linked to the state’s rejection of Medicaid expansion.
In states that expanded Medicaid, the Medicare reduction is offset by the increased number of people who are insured (either through private coverage sold on the marketplace or Medicaid). In states that don’t expand Medicaid, the uninsured rate remains higher and hospitals continue to struggle with higher levels of uncompensated (charity) care.
A Medicaid expansion bill, HB 2319, was introduced in the 2015 session and got a hearing before the House Health and Human Services Committee. The acting secretary for the Kansas Department of Health and Environment testified that expansion would cost the state $2.4 billion between 2016 and 2025, and the committee didn’t act on the bill.
Brownback seemingly reversed course on Medicaid expansion in 2015. During a speech to Missouri legislators, Brownback said he would most likely sign off on Medicaid expansion if it were budget neutral. Yet despite renewed calls to expand Medicaid with the news of Mercy Hospital’s closure, Brownback’s position was that the state can’t afford to expand Medicaid.
How Kansas approached marketplace implementation
Kansas opted to use HealthCare.gov rather than implement a state-run marketplace. The decision against a Kansas-run exchange came despite the efforts of Insurance Commissioner Sandy Praeger and some initial support from Brownback. Brownback, while critical of the Affordable Care Act, initially supported Praeger’s exchange planning efforts.
However, Brownback grew less and less supportive over time. In August 2011, Brownback returned a federal grant intended to help the state develop technical infrastructure for running the exchange. The return of the grant effectively quashed a state-run exchange, so Praeger began recommending state-federal partnership as a way for the state to retain some control.
In November 2012, Brownback announced that the state would default to a federally operated exchange, issuing a statement that said in part, “My administration will not partner with the federal government to create a state-federal partnership insurance exchange because we will not benefit from it and implementing it could costs Kansas taxpayers millions of dollars.”
During the 2014 legislative session, Kansas lawmakers debated a bill (SB 362) that would have subjected anyone who wanted to serve as a navigator to requirements above and beyond those at the federal level. Kansas navigators would have been subjected to criminal background checks, been fingerprinted, required to disclose their credit histories, and charged an annual $100 registration fee. The bill would have also prohibited navigators from recommending a specific insurance policy for a consumer. The bill passed the Senate, but failed to clear a House committee.
Kansas health insurance exchange links
State Exchange Profile: Kansas
The Henry J. Kaiser Family Foundation overview of Kansas’ progress toward creating a state health insurance exchange.
Kansas Insurance Department, Consumer Assistance Division
Assists consumers who have purchased insurance on the individual market or who have insurance through an employer who only does business in Kansas.
(800) 432-2484 / Local: (785) 296-7829