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Kentucky health insurance

KY enrollment in exchange plans grew in 2018; Medicaid work requirement and premiums take effect in July 2018

2018 enrollment update

Kentucky insurance overview

Kentuckians shopping for their own health insurance continue to use HealthCare.gov in 2018, just as they did for 2017. Before that, residents in Kentucky used the state-run Kynect to purchase coverage, but Governor Matt Bevin, who took office in 2015, transitioned the state to the federal enrollment platform as of 2017. Kentucky technically still has a state-run exchange, though, and is one of five states that have state-run exchanges but use HealthCare.gov for enrollment.

Bevin also wanted to repeal the state’s Medicaid expansion, but that proved to be a non-starter. Instead, Bevin focused his efforts on modifying the Medicaid program in an effort to reduce total enrollment. Kentucky was the first state in the country to receive federal approval for a Medicaid work requirement, which will take effect in July 2018. In addition, the state’s Medicaid program will begin to charge premiums for some enrollees, and retroactive coverage under Medicaid will be elimiated.

Despite electing Bevin and an initial deep skepticism of Obamacare, Kentucky residents have benefited greatly from healthcare reform in recent years. The Bluegrass State has been touted as one of the Affordable Care Act’s biggest success stories, with sharp declines in its uninsured population (from 14.3 percent uninsured in 2013 to just 5.1 percent uninsured in 2016, according to US Census data). The state’s adoption of Medicaid expansion played a significant role in the sharp decrease in the number of Kentucky residents without health insurance, but there may be an uptick in the uninsured rate after Bevin’s waiver to alter Medicaid is implemented.

In 2018, the state’s exchange is offering individual plans from two carriers (Anthem BCBS and CareSource Kentucky). Rate increases were steep, at an average of 41 percent for Anthem and 56 percent for CareSource. But those average rate increases included the cost of cost-sharing reductions (CSR) being added to silver plan rates, since CSR funding was eliminated by the Trump Administration.

Without the cost of CSR being added to premiums, average rate increases would have been significantly lower. But ultimately, most consumers were better off with the higher rates, because the bulk of the rate hikes applied to silver plan, and premium subsidies are based on the cost of silver plans. Higher silver plan rates result in larger subsidies, which can be used to purchase any metal level plan — including non-silver plans that don’t have the cost of CSR added to them. And enrollees who don’t get premium subsidies can purchase non-silver plans in order to avoid the added cost of CSR.

Kentucky health ratings

When it comes to public health, Kentucky faces some challenges. The state has received low rankings from various evaluations in recent years.

The Commonwealth Fund’s 2015 Scorecard on State Health System Performance ranked Kentucky 40th, up from 42nd in 2014. And in the 2017 Scorecard, Kentucky improved slightly again, reaching 39th place. The state has seen improvements in terms of access to care, which likely contributed to the higher ranking. The state had its best ranking in the Access category (18th), but ranked 50th in terms of Avoidable Hospital Use & Cost.

At number 44, the Bluegrass State landed in the bottom 10 percent of America’s Health Rankings 2015 as well; however, this was an improvement from 47 in 2014. And in the 2017 Rankings, Kentucky improved slightly again, reaching number 42. An increase in the percentage of the population with health insurance is one of the reasons Kentucky has moved up in the rankings.

The 2016 edition of the Trust for America’s Health report ranked Kentucky 36th for percentage of uninsured, all ages—8.5 percent of the state’s population was without insurance in 2014. See Key Health Data About Kentucky for additional public health indicators.

The 2016 county-by-county health rankings for Kentucky, which are put together by the Robert Wood Johnson Foundation and the Population Health Institute at the University of Wisconsin, reported that in the county with the lowest uninsured rate, 10 percent of the population under age 65 was uninsured. In the county with the highest uninsured rate, 24 percent of the population was uninsured. However, these statistics come from 2013 data, before the Affordable Care Act had fully taken effect.

How has Obamacare helped KY?

In 2013, Kentucky’s uninsured rate was 14.3 percent — just slightly lower than the national average at that point. But by 2016, the state’s uninsured rate had dropped to 5.1 percent, which was well below the 8.6 percent national average at that point. This reduction was due in large part to the state’s highly successful state-run exchange (Kynect) and the expansion of Medicaid under the ACA.

But when the 2017 open enrollment period began on November 1, 2016, Kentucky residents switched to using HealthCare.gov for enrollment. Kynect had been widely considered among the country’s most successful state-run exchanges. However, Gov. Matt Bevin, who took office in 2015, transitioned the state to the federal enrollment platform in an effort to curtail costs and take advantage of HealthCare.gov’s economies of scale.

Kentucky still has a state-based exchange, but they no longer have the autonomy that goes along with having a state-run enrollment platform. As an example, when the open enrollment period for 2018 coverage was cut in half, 10 of the 12 states with state-run enrollment platforms opted for longer enrollment periods. But states that used HealthCare.gov had no choice but to go along with the shorter open enrollment period.

Rates and carriers for 2018 coverage

Aetna, WellCare, Baptist Healthy (Bluegrass Family Health), and UnitedHealthare exited the Kentucky exchange at the end of 2016, and Humana left at the end of 2017. But Anthem Blue Cross Blue Shield and CareSource Kentucky are continuing to offer plans for sale in Kentucky’s exchange in 2018.

Their approved average rate increases (including the additional amount that was added to silver plan premiums to cover the cost of cost-sharing reductions) were:

  • Anthem BCBS: 41.2 percent
  • CareSource Kentucky: 56 percent

Open enrollment for 2018 coverage, including on and off-exchange plans, ran from November 1, 2017 to December 15, 2017. Open enrollment for 2019 coverage will follow the same schedule in the fall of 2018. But people who qualify for Medicaid or CHIP can enroll anytime, as can Native Americans. In addition, people with certain qualifying events can enroll outside of open enrollment.

Kentucky enrollment in qualified health plans

Nearly 83,000 Kentucky residents signed up for qualified health plans (QHPs) during the ACA’s first open enrollment period in 2014. That was 27.4 percent of the estimated eligible market of 302,000 people. For comparison, Vermont led the nation with a sign-up rate of 85.2 percent of its eligible residents, and the national average was 28 percent.

Kynect made a big push to enroll Kentucky’s remaining uninsured during 2016 open enrollment with community outreach focused on 18 counties where the uninsured rates were highest. Forty-three percent of the state’s 285,000 uninsured were eligible for Medicaid under Kentucky’s expanded eligibility guidelines.

However, Kentucky’s enrollment in private plans dropped 12 percent from 2015 to 2016, falling from 106,330 at the end of 2015 open enrollment to 93,687 by the end of 2016 open enrollment on Jan. 31. Effectuated enrollment was 74,640 as of March 31, a drop of 20 percent. Nationally, the drop was 13 percent.

Enrollment dropped again for 2017, due to the switch to HealthCare.gov as well as reduced funding for exchange outreach and marketing. Just 81,155 people signed up that year. But for 2018, despite a much shorter open enrollment period (just over six weeks, as opposed to three months), year-over-year enrollment grew by more than 10 percent, to 89,569 people. Rhode Island was the only state that had a higher percentage increase in enrollment from 2017 to 2018.

The Affordable Care Act in the Bluegrass State

In 2010 passage of the Affordable Care Act, Kentucky’s two Republican senators voted “no.” Kentucky’s current senators remain firmly opposed to the ACA. Mitch McConnell was re-elected to the U.S. Senate in the 2014 election and took over as majority leader in January 2015. Shortly after his re-election, McConnell joined then-House Speaker John Boehner in vowing to continue efforts to repeal the ACA. Former Sen. Jim Bunning was replaced by Sen. Rand Paul, who says he would not have voted for the ACA and is in favor of seeing the law repealed.

Kentucky’s representatives in the House split their votes on the ACA along party lines, with two yes votes and four no votes. Kentucky’s current Representatives include five Republicans and just one Democrat. One of the Republicans, Thomas Massie, was among 20 Republicans in the House of Representatives who voted no on the American Health Care Act in 2017, which would have repealed several major portions of the ACA. That bill passed in the House, but failed to pass in the Senate and was never enacted.

At the state level, former Gov. Steve Beshear’s support of the ACA repeatedly drew national attention, with even President Obama making note of it during his 2014 State of the Union address. Beshear used an executive order to establish Kentucky’s state-run health insurance marketplace, Kynect.

Kynect was viewed as a model for state-run marketplaces. Beshear also fully supported Medicaid expansion, calling it the “single most important decision” for improving the health of Kentucky residents.

However, on Nov. 3, 2015, Kentucky elected Republican Matt Bevin to be the state’s next governor. Strongly against Obamacare, Bevin promised to dismantle Kynect and transition the state to HealthCare.gov. He was able to do this, since Kynect had been established by executive order in the first place.

Bevin also said he would repeal Medicaid expansion as it currently exists and pursue a Section 1115 waiver allowing Kentucky to design its own version of Medicaid expansion and repeal the existing expansion. The vast majority of Kentucky, 70 percent, preferred that Bevin keep the state’s expanded Medicaid program as-is. Bevin’s stance on Medicaid expansion softened a bit, but he sought federal approval for his Kentucky HEALTH program, and the waiver was approved in January 2018. It will allow Kentucky to impose a work requirement and premiums as of July 2018, and eliminate retroactive Medicaid coverage. Medicaid expansion will still be in place, but with additional restrictions and a new My Rewards account.

Kentucky Medicaid/CHIP

In addition to implementing a state-run health insurance exchange, Kentucky expanded Medicaid under the Affordable Care Act. Under the expansion, Kentucky residents with household income up to 138 percent of the federal poverty level ($16,105 a year for one person or $32,913 for a family of four) are eligible for Medicaid.

About 358,000 Kentucky residents were deemed eligible for Medicaid or the Children’s Health Insurance Program (CHIP) during the ACA’s initial open enrollment period.

From 2013 to December 2017, Kentucky Medicaid enrollment increased 110 percent, the biggest change nationwide. Nevada saw the second-biggest change with a 92 percent increase. Enrollment in Medicaid and CHIP continues throughout the year, which means this number is constantly changing.

After the Trump Administration clarified that they would be open to the possibility of work requirements for Medicaid, Kentucky was the first state to receive federal approval to implement a Medicaid work requirement, which will take effect in mid-2018. The state will also begin charging premiums for some enrollees, and will eliminate retroactive Medicaid coverage.

Visit the Kentucky Department for Medicaid Services website for information about the state Medicaid program and the Kentucky Children’s Health Insurance Program (KCHIP).

Does KY have a high-risk pool?

Before the ACA reformed the individual health insurance market, pre-existing conditions were a barrier to obtaining coverage in nearly all states, including Kentucky. Medical histories were scrutinized during the application process, and people who didn’t meet the health eligibility guidelines were unable to purchase private coverage. Kentucky Access was established in 2001 to offer coverage to people who were not able to get policies in the individual market because of pre-existing conditions.

Under the ACA, all new health insurance policies became guaranteed issue starting on January 1, 2014. This aspect of reform largely eliminated the need for high-risk pools, and Kentucky Access notified their members that the plan would cease operations at the end of 2013. Insureds were able to transition to private coverage through Kynect instead.

Other ACA reform provisions

The ACA established a federal loan program to encourage the creation of Consumer Operated and Oriented Plans (CO-OPs), which are nonprofit, consumer-run health insurance companies. Through the program, 24 CO-OPs were set up as of January 2014, including the Kentucky Health Care Cooperative. However, 19 of them, including Kentucky’s, have folded.

Kentucky Health CO-OP had robust enrollment in 2014, and had planned to expand into neighboring West Virginia for 2016. But the CO-OP shut down at the end of 2015, along with several others that closed at the same time, due in large part to the significant shortfalls in risk corridors funding that year.

KY Medicare enrollment

Kentucky Medicare enrollment reached 862,887, about 20 percent of the state’s population, in 2015. Nationwide, 17 percent of the population is enrolled in Medicare.

Kentucky has the highest percentage of Medicare recipients listed as disabled: 25 percent. The other 75 percent qualify for Medicare based on age alone. Medicare pays about $8,891 per Kentucky enrollee each year.

Kentuckians who want additional benefits beyond those offered through original Medicare can opt for a Medicare Advantage plan instead, and 28 percent of Kentucky beneficiaries selected Medicare Advantage in 2017. Nationally, 33 percent of Medicare beneficiaries choose a Medicare Advantage plan over traditional Medicare coverage.

Medicare Part D plans provide a way for Medicare recipients to gain stand-alone prescription drug coverage. About 52 percent of Kentucky’s Medicare recipients enrolled in a Medicare Part D plan in 2017.

Kentucky’s state-based reform legislation

Scroll to the bottom of the page to see what’s happening legislatively in Kentucky with healthcare reform at the state level.


Louise Norris is an individual health insurance broker who has been writing about health insurance and health reform since 2006. She has written dozens of opinions and educational pieces about the Affordable Care Act for healthinsurance.org. Her state health exchange updates are regularly cited by media who cover health reform and by other health insurance experts.

More Kentucky coverage

Exchange

News, history, and enrollment info for your state marketplace

Medicaid

Your state’s Medicaid expansion, eligibilty, contacts

Medicare

Insurance for those over 64 (off-site)