In 2015, there were three carriers offering individual plans in the Nebraska exchange: Assurant, Blue Cross Blue Shield of Nebraska, and Coventry. Assurant announced in June that they are exiting the individual market nationwide, and their plans will not be for sale during the 2016 open enrollment that starts November 1. But two new carriers are joining the Nebraska exchange for 2016: UnitedHealthcare of the Midlands, and Medica.
The Nebraska Department of Insurance has published final approved rates for 2016, including premium amounts for 15 different sample scenarios. The approved rate changes are:
- Blue Cross Blue Shield of Nebraska: 14.8 percent average rate increase
- Coventry: 21.89 percent average rate increase (but actual rates are still lower than BCBS in every sample scenario).
- UnitedHealthcare of the Midlands: New to the exchange, but the approved rates for 2016 are lower than BCBS and Coventry for every sample scenario.
- Medica: New to the exchange. Approved rates for 2016 are lower than BCBS and Coventry in some scenarios, and higher in others.
So although Blue Cross Blue Shield and Coventry will both experience relatively steep rate increases, the addition of UnitedHealthcare and Medica will give consumers other options from which to choose – highlighting the importance of shopping around during open enrollment rather than simply letting an existing plan auto-renew.
The Nebraska Department of Insurance’s premium report is also interesting in terms of being able to see how actual rates – as opposed to percentage rate changes – stack up against each other. As we watch rate changes across the country, they’re typically reported in terms of the percentage increase for each plan.
In the case of Nebraska, if we only saw the fact that Coventry’s rates are increasing by almost 22 percent versus under 15 percent for BCBS, we might assume that Coventry enrollees will be worse off in 2016. But when we see the actual rates side-by-side, it’s clear that Coventry enrollees will still be paying less for their coverage in 2016 (Coventry’s rates decreased from 2014 to 2015, which is also helpful perspective from which to view the 22 percent rate increase for 2016).
And of course, the addition of two new carriers – one of which has the most competitive rates overall – will bring an added measure of competition to the Nebraska exchange in 2016.
Subsidies will offset some of the rate increase
The Supreme Court upheld the legality of subsidies in every state in a 6 – 3 ruling issued on June 25. The plaintiffs had argued that subsidies could only be provided in state-run exchanges, and if they had prevailed, 56,000 people in Nebraska would have lost their subsidies. Their coverage would most likely have become unaffordable without subsidies, with premium increases that would have averaged 265 percent.
Republican leaders in Nebraska were disappointed with the Court’s ruling, and have continued to push for full repeal of the ACA.
Because the subsidies were upheld, they will still be in place in 2016, and will mitigate some of the rate increases for current exchange enrollees (88 percent of exchange enrollees in Nebraska are receiving subsidies). But the fact that UnitedHealthcare is entering the exchange with lower prices than the two existing carriers means that the subsidies won’t have to increase by as much as the current plans are increasing in order to keep the second-lowest-cost silver plan within the ACA’s definition of affordable. Again, that highlights the importance of shopping around during open enrollment.
Medicaid expansion under consideration
Although Nebraska has not yet expanded Medicaid, a group of lawmakers began meeting in September 2015 to discuss ways that the state could move ahead with a Medicaid expansion proposal. Republican Senator John McCollister, from Omaha, is leading the coalition of lawmakers, and says his support for Medicaid expansion began to coalesce after two University of Nebraska Kearney professors released a study in April that showed the state would realize one billion in economic benefits if Medicaid were expanded.
But the state legislature has already addressed the issue three times, and rejected it every time. 2015’s Legislative Bill 472 would have expanded Medicaid to cover the 33,000 Nebraska residents who have fallen into the coverage gap – they aren’t eligible for current Medicaid, but they have incomes too low to qualify for subsidies in the exchange. All told, LB472 would have provided Medicaid coverage to about 54,000 people in the state, including those who earn between 100 percent and 133 percent of the federal poverty level. They currently qualify for subsidies in the exchange, but would qualify for Medicaid instead if the program were expanded.
LB472 did not pass during the 2015 session, and will be waiting for lawmakers to take it up again when they reconvene in January. But sponsor Senator Kathy Campbell said she was pleased with the Supreme Court’s ruling to keep exchange subsidies available, and noted that she and her colleagues will continue to push towards Medicaid expansion and a solution for the people who are in the coverage gap in Nebraska.
In 2014, the Nebraska Department of Health and Human Services held a public hearing on LB887, the Wellness in Nebraska Act, and the issue has general support from state residents – 56 percent of poll respondents in Nebraska are in favor of Medicaid expansion. But the bill ultimately died in the legislature, as did the similar LB577 the year before.
Chuck Hassebrook, the Democratic candidate for Governor in the 2014 election said that he’d make Medicaid expansion a priority. Hassebrook noted that the survival of rural hospitals depends on Medicaid expansion. But ultimately, Pete Ricketts, a Republican who is opposed to Medicaid expansion, won the election. Governor Ricketts is opposed to the ACA in general, and prefers ideas like tort reform, tax credits, and expanded health savings accounts (HSAs). He has maintained his opposition to Medicaid expansion in 2015, and continues to oppose it despite the work of McCollister and the other lawmakers who are considering a path towards Medicaid expansion.
Supporters of Medicaid expansion are considering a ballot initiative in 2016 if they are not successful in the legislature.
74,152 people enrolled in private plans through the Nebraska exchange during the 2015 open enrollment period (through February 22, including the week-long extension). 53 percent are new to the exchange for 2015, and 88 percent are receiving premium subsidies.
Attrition is a normal part of the individual health insurance market however. That’s always been the case, but now that the bulk of enrollments are confined to a short window during the winter, attrition is more noticeable during the summer. Some enrollees don’t pay their initial premiums, and others either cancel their coverage or are terminated because of immigration documentation issues (subsidies are also terminated for people who don’t provide the necessary financial documentation, which can lead to enrollees choosing to cancel their coverage). By the end of June, 63,776 had in-force coverage in the Nebraska exchange.
An additional 7,218 people enrolleed in Medicaid or CHIP through the exchange between November 15 and February 22, qualifying under the state’s unchanged guidelines, as Nebraska has not yet expanded Medicaid. Medicaid and CHIP enrollment continue year-round.
Open enrollment for 2015 has ended, although you can still obtain 2015 coverage if you have a qualifying event. The next open enrollment period begins on November for coverage effective January 1, 2016.
CoOportunity was an Iowa-based ACA-created CO-OP that was one of four carriers offering 2015 plans in the Nebraska exchange. But in late December 2014, CoOportunity was taken over by Iowa state regulators, and stopped selling policies in either state. Despite the fact that CoOportunity enrolled 120,000 people in Iowa and Nebraska in 2014 CoOportunity did not receive the ongoing federal funding that many other CO-OPs received last fall. CoOpportunity’s enrollment was far higher than most other CO-OPs around the country in 2014; second only to Health Republic of NY, which is closing at the end of 2015.
Immediately following the take-over, it was unclear whether CoOportunity could be rehabilitated. But ultimately, in late January, regulators determined rehabilitation would not be possible, and the CO-OP would be liquidated. Regulators said that existing claims exceeded CoOportunity’s assets, but the Nebraska state Guaranty Association is there to protect insureds when carriers fail, and the $500,000 per-insured limit is adequate in this case, according to Nebraska’s Insurance Commissioner Bruce Ramge.
CoOportunity still had about 40,000 policy-holders in Nebraska as of late January. Initially, regulators said that people who had enrolled prior to December 15 could keep their CoOportunity plans, but were encouraged to shop for new coverage prior to the end of open enrollment (people who enrolled after December 15 did not have coverage with the CO-OP and had to choose another plan).
Blue Cross Blue Shield of Nebraska reported that their call centers were extremely busy early in 2015, as they were helping thousands of CO-OP members secure new coverage.
But once it was determined that the CO-OP would be liquidated, all of the existing policy-holders needed to begin the process of transitioning to a new carrier. By the end of August, there were only about 300 remaining CoOpportunity members, and their coverage ended at that point (they had access to a 60 day special enrollment period as a result of losing their coverage).
2015 rates and carriers
With CoOpportunity’s exist, there were three carriers participating in the Nebraska exchange in 2015: Blue Cross Blue Shield of Nebraska, Coventry Health Care, and Assurant. Health Alliance Midwest offered policies in 2014, but did not participate in 2015. Assurant was new to the Nebraska exchange for 2015 (but is exiting the market nationwide and will not participate in the 2016 open enrollment).
The Nebraska Department of Insurance released a sampling of 2015 rates in September 2014. They illustrated 15 different scenarios, with varying household sizes, ages, and geographic locations across the state. For each carrier, they showed the rate change for each scenario, along with an average for all 15 scenarios from each carrier.
Across the four carriers that were originally slated to sell plans for 2015 (including CoOportunity), the unweighted average for the 15 sample scenarios was a 10.7 percent increase in premiums. But one carrier – Coventry – had an average rate decrease of 3.4 percent. And while Assurant’s average rate hike across the sample scenarios is 16 percent, their prices in 2014 (off-exchange) were lower than those offered by the exchange plans – they gained market share in 2014 even though they were only available off-exchange.
PricewaterhouseCooper LLC analyzed individual market premiums, calculating weighted average rates for the 2015 open enrollment period. They found an average increase of 9 percent across the four Nebraska carriers, including on and off-exchange plans (the study was conducted throughout the late summer/autumn, and rates are current as of late November).
But the Kaiser Family Foundation did another analysis in November 2014, looking at a 40 year old enrollee in the Omaha area, who enrolled in the benchmark plan (second lowest-cost silver plan) in 2014 and was willing to switch plans – if necessary – in order to continue to be covered by the benchmark plan in 2015. For that scenario, they found an average price decrease of 2.6 percent.
People in the Omaha area who renew the benchmark plan from 2014 instead of switching to the new benchmark plan could be in for some sticker shock however, and the Omaha area is a perfect example of why auto-renewal is not in your best interest, even if it’s available to you. The NY Times put together an interactive map showing how the benchmark plans changed for 2015, and there was a stark difference between renewing versus switching if you’re in northeastern Nebraska.
An analysis conducted by the Commonwealth Fund and published in December 2014 found an average rate increase of 10 percent for a 40 year-old non-smoker in the Nebraska exchange, when looking at all plans and metal levels. But for silver plans, the rate increase was an average of just 4 percent, and it’s likely that the rate increase became smaller once CoOportunity’s plans were no longer for sale, since the CO-OP had raised its rates considerably for 2015.
2014 enrollment numbers
During the first open enrollment period that ended in April, 42,975 people finalized their private plan Obamacare enrollments in the Nebraska exchange (as of April 19). And another 10,360 people had enrolled in ACA-compliant plans off-exchange.
An additional 9,879 exchange applicants had been found to be eligible for existing Medicaid in Nebraska (Nebraska has not expanded Medicaid under the ACA, a decision that disproportionately impacts the large rural population).
HHS is running the exchange in Nebraska via HealthCare.gov. Residents who need enrollment assistance can contact Community Action of Nebraska or HRS/Erase, Inc. (now called Resolute) – both received federal grants – totaling $600,000 – in September 2015 to hire navigators who can answer questions and assist with the enrollment process.
Community Action of Nebraska has a toll free number (1-800-318-2596) that people can use if they want to enroll over the phone. Residents who want in-person help can also visit one of Community Action’s offices to meet with a navigator.
Nebraska’s Department of Insurance allowed pre-2014 plans to be extended in 2014. Following the Obama Administration’s announcement in March that pre-2014 plans could be extended for up to two more years, the Nebraska Department of Insurance decided in late April to allow pre-2014 health insurance plans to be extended out as far as October 2016.
It is up to each carrier to decide whether to accept this option; Blue Cross Blue Shield of Nebraska announced in May that they would allow pre 2014 plans to be extended into 2016.
Exchange history in Nebraska
Despite work completed by the Nebraska Department of Insurance (DOI), Gov. Dave Heineman announced in November 2012 that the state would not operate a health insurance exchange. In rejecting a state-run exchange, Heineman said it would be much more expensive for the state to run its own exchange. He also expressed doubt that even a state-run exchange would give Nebraska much authority over exchange operations.
Governor Heineman has also refused to expand Medicaid, but state Senator Jeremy Nordquist is pushing for Medicaid expansion and called on Heineman to forfeit his own health insurance until all Nebraskans are able to have coverage.
Before Heineman’s final decision, he had expressed some support for a state-run exchange, and the DOI had studied that option. The DOI gathered input from stakeholders, developed a set of working assumptions around policy and operations, and issued a number of requests for information and requests for proposals to engage subcontractors in developing an exchange.
While the federal government manages most functions for the new marketplace, Nebraska oversees participating health plans. The Nebraska legislature also authorized a workgroup, called the Nebraska Exchange Stakeholder Commission, to provide input to state and federal officials on how the marketplace should operate.
In early December, 2014, the Nebraska Exchange Stakeholder Commission announced their recommendation that Nebraska continue to have a federally-run exchange, noting that it would be costly and difficult to switch to a state-run exchange at this point, especially given that federal funding is no longer available to establish a state-run exchange.
Contact the exchange
The federal government operates the exchange in Nebraska
More Nebraska health insurance exchange links
State Exchange Profile: Nebraska
The Henry J. Kaiser Family Foundation overview of Nebraska’s progress toward creating a state health insurance exchange.
Nebraska Department of Insurance
Assists consumers who have purchased insurance on the individual market or who have insurance through an employer who only does business in Nebraska.
(877) 564-7323 / Toll Free: (800) 833-7352
Nebraska DOI’s overview of the exchange
An in-depth document published in September 2013 that details how the exchange will work for individuals and small businesses.
Advocacy group working to raise awareness about the Nebraska exchange.