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North Dakota health insurance marketplace: history and news of the state’s exchange

Enrollment grew for 2017, and many enrollees saw a slight rate decrease

North Dakota did not establish its own exchange, so enrollments are completed via HealthCare.gov. However, the state has expanded Medicaid under the ACA.

HHS estimated that there were 4,000 people in North Dakota who had off-exchange coverage in 2016, but who would be eligible for subsidies if they switched to exchange plans. During open enrollment, or during a special enrollment period triggered by a qualifying event, people can switch to any plan they like, on or off-exchange (most special enrollment periods apply off-exchange, but a few do not).

Looking ahead to 2018

Open enrollment for 2018 coverage will begin on November 1, 2017, and continue until December 15, 2017. This is significantly shorter than previous open enrollment periods, and it’s the first time that no enrollments will be allowed (without a qualifying event) after the start of the new year. All plans purchased during open enrollment will take effect January 1, 2018.

Insurers filed rates for 2018 plans in mid-May in North Dakota, and the North Dakota Insurance Department is currently reviewing them. The Insurance Department confirmed that all three current exchange insurers filed plans for 2018, but data about the rate filings is not yet public.

North Dakota exchange and the Trump Administration

There is considerable uncertainty about the future of the ACA and the stability of the individual health insurance market under the Trump Administration. House Republicans passed the American Health Care Act (AHCA) in early May, although it faces a challenging future in the Senate, where lawmakers are writing their own version of the bill. If enacted, the AHCA would change or repeal numerous ACA provisions.

But even if the AHCA isn’t enacted, the stability of the insurance markets is in question. Two pressing issues for insurers are the enforcement of the individual mandate, and continued federal funding for cost-sharing reductions. The Trump Administration has called for relaxed enforcement of the individual mandate, and the AHCA would eliminate the penalty altogether, retroactive to the start of 2016. Trump has also threatened on more than one occasion to withhold cost-sharing reduction funding as a means of getting Democrats to negotiate on health care reform (funding for cost-sharing reductions is the subject of an ongoing lawsuit, which has been pended until August; Trump could still opt to cut off funding before then).

California’s exchange has said that if the individual mandate were repealed and cost-sharing reduction funding were to be eliminated, premiums would increase by an average of 42 percent. In North Carolina, the state’s dominant insurer has requested a 22.9 percent increase for 2018, but has said that it would only be 8.8 percent if funding for cost-sharing reductions was committed for the rest of 2017 and for 2018. And in Pennsylvania, the Insurance Department has said that rates will increase an average of 8.8 percent if cost-sharing reductions are funded and the individual mandate is enforced, but 36.3 percent if neither of those things happen. In general, the insurance markets are looking fairly stable heading into 2018, as long as the individual mandate is preserved and cost-sharing reduction funding continues to flow to insurers.

But for the time being, nothing has changed. Coverage is still available in the exchange if you experience a qualifying event, although Native Americans and people who are eligible for Medicaid/CHIP can enroll year-round, without a qualifying event.

2017: lower prices and higher enrollment, both in contrast with most of the rest of the country

The majority of North Dakota exchange enrollees saw a small average rate decrease for 2017, which was extremely rare this year (overall, there was a slight increase in weighted average premiums, but the small decrease applied to the majority of enrollees; details below).

21,982 people enrolled in qualified health plans through the North Dakota exchange during the 2017 open enrollment period, which ended January 31, 2017. That’s a 1.7 percent increase over the 2016 enrollment total. Across all states that use HealthCare.gov, there was an average decrease in enrollment of about 5 percent from 2016 to 2017, but North Dakota bucked that trend. The lower premiums were likely a factor, as rates in most other states increased significantly for 2017.

19,358 people were enrolled in North Dakota’s expanded Medicaid as of September 2016. The state had estimated that 20,500 people would be eligible for expanded Medicaid, and the enrollment total had leveled off in 2016, a little below that amount.

2017 rates and carriers

There are three carriers that offer plans in the North Dakota exchange. BCBS of ND and Sanford offer coverage statewide, while Medica offers coverage everywhere except four counties in the northwest corner of the state. Their average

Average rate increases for 2017 were all smaller than the carriers had proposed:

  • BCBS of ND: a 1.57 percent decrease (the carrier had proposed a 1.82 percent rate increase).
  • Medica: 14.3 percent increase (the carrier had proposed a 16.9 percent rate increase)
  • Sanford: 7.85 percent increase (the carrier had proposed a 10.7 percent rate increase)

North Dakota regulators approved rates that were lower than requested, just as they did the year before. For 2016, BCBS of ND and Medica both proposed rate hikes of more than 16 percent, but state regulators trimmed them down to under 13 percent.

BCBS of ND has the majority of the exchange’s enrollment, so their small rate decrease means that the overall average rate increase in North Dakota is just 1.3 percent, which was tied with Rhode Island as the lowest in the country, by far.

BCBS of ND’s CEO, Tim Huckle, noted that “financially, [BCBSND was] having another solid year” in 2016. Huckle also explained that premiums in North Dakota were probably more realistic in 2014 than they were in other states (where they were too low), which helped to prevent huge rate increases in the ensuing years.

Sanford had 4,310 enrollees in the North Dakota exchange as of August 2016, and 1,170 off-exchange enrollees. They noted that while most of their off-exchange enrollees had ACA-compliant plans, the off-exchange total also included their remaining grandfathered and transitional enrollees.

The average benchmark plan (second-lowest-cost silver) premium in North Dakota is 7 percent higher in 2017, so subsidies are a little larger in 2017 to offset the higher benchmark premiums. For comparison, across all the states that use HealthCare.gov, the average benchmark premium increase was 22 percent.

2016 enrollment

21,604 people enrolled in private plans through the North Dakota exchange during the 2016 open enrollment period. That was a 19 percent increase over 2015, when 18,171 people selected private plans through the exchange.

By March 31, effectuated enrollment in the North Dakota exchange stood at 20,536. Nearly 86 percent of the effectuated enrollees are receiving premium subsidies to offset the cost of their coverage. The average premium subsidy in North Dakota is $262 per month, and the average after-subsidy premium is $142 per month.

More than 7,500 enrollees in North Dakota were new to the exchange for 2016. Total enrollment in private plans through the exchange in North Dakota is lower than every other state except Hawaii, but that’s to be expected given North Dakota’s low population and small number of people eligible to shop in the exchange.

Open enrollment for 2016 coverage ended on January 31. The next open enrollment period – for coverage effective in 2017 – will begin on November 1. Between now and then, enrollment is only available if you have a qualifying event (Native Americans can enroll year-round without a qualifying event, and so can enrollees who are eligible for Medicaid or CHIP).

2016 rates and carriers

There are three carriers in the North Dakota exchange offering plans for 2016; all of them also offered plans in 2015 and 2014. Blue Cross Blue Shield of North Dakota and Medica had both proposed rate hikes in excess of 16 percent, but regulators trimmed the approved rate increases down to less than 13 percent for each of them. Sanford’s proposed rate increase was approved without changes. For 2016, here are the average rate increases for each of the North Dakota exchange carriers:

  • BCBS of ND: 12.6 percent rate increase (a reduction from the 18.4 percent rate hike they requested)
  • Medica: 12.8 percent rate increase (a reduction from the 16.5 percent rate hike they requested)
  • Sanford: 8.49 percent rate increase (approved as requested).

As of September 2015, the North Dakota Insurance Department reported that effectuated enrollment through the exchange was:

  • BCBS of ND = 11,705 members
  • Medica = 3,067 members
  • Sanford = 1,894 members according to ND Ins. Dept (according to Sanford, the count is a little lower, at 1,772).

The overall weighted average rate increase in the North Dakota exchange for 2016 was 12.2 percent, using the market share numbers from September. That’s significantly better than it would have been (nearly 17 percent) if rates had been approved as-requested.

And the 12.2 percent average rate increase is based on the assumption that everyone kept the same plan they had in 2015; shopping around results in different effective rate changes (nationwide, the average rate change if people kept their 2015 plans was around 12 to 13 percent. But when we account for plan changes, it was more like 9 percent).

According to HHS, the average benchmark premium in North Dakota is 8.9 percent higher in 2016 than it was in 2015. Since benchmark plans aren’t necessarily the same plan from one year to the next, that number doesn’t give us much data in terms of how rates have changed for people who kept their 2015 plans.

But it does tell us that subsidies are higher on average than they were in 2015 in North Dakota. So subsidies are offsetting some of the rate increase for enrollees who are subsidy-eligible.

2016 off-exchange average rate hike 12.4%

Time Insurance Company (which offered off-exchange plans in 2015 in North Dakota) initially proposed significant rate hikes, but it was subsequently announced that the parent company – Assurant – would exit the health insurance market nationwide, and would not offer plans for 2016.

According to rate filing data submitted by the carriers in the spring of 2015, BCBS of ND had roughly 29,000 members, and Medica had 4,778 members. Sanford’s filing was for a rate hike of less than ten percent, so it wasn’t made public until the end of October – and it didn’t include total market share numbers. But according to Sanford, they had 267 off-exchange members as of September 2015, and a total enrollment of 2,039 people, including exchange enrollments.

Based on these numbers, the overall weighted average rate increase in the combined ACA-compliant individual market in North Dakota is 12.4 percent.

BCBS of North Dakota profitable in 2015

Blue Cross Blue Shield of North Dakota is the dominant carrier in North Dakota’s individual market, both on and off-exchange. And in 2015, the carrier was profitable across all lines of business – a reversal of course for BCBSND, which had struggled with losses in 2013 when its subsidiary, Noridian, bungled a health insurance exchange platform that they were creating for Maryland.

BCBSND’s profitability – including in the individual market – is in contrast to many carriers across the country, where individual market losses were common in 2015.

Sanford, another North Dakota insurer, posted a $76.5 million loss for 2015, but half of that was money set aside to cover anticipated losses in 2016. Sanford’s losses stemmed from their new contract to cover the state’s Public Employees Retirement System group, which BCBSND handled for 37 years until Sanford got the contract in 2015. Sanford also experienced higher-than-expected claims in the individual market in North Dakota, which was generally the case with most insurers nationwide in 2015.

Navigator grants

Three organizations in North Dakota received a total of nearly $637,000 in navigator grants in 2015 that were used for outreach and enrollment efforts. The grants were awarded to Family HealthCare Center, Great Plains Tribal Chairmen’s Health Board, and Minot State University’s North Dakota Center for Persons with Disabilities. Residents in North Dakota can reach out to any of these organizations for in-person enrollment help.

The same three organizations again received nearly $637,000 in navigator grants in 2016. Residents in North Dakota can reach out to any of these organizations for in-person enrollment help.

2015 enrollment

During the 2015 open enrollment period, 18,171 people completed their private plan enrollments in the North Dakota exchange, including 10,080 who renewed 2014 coverage (55 percent of the 2015 total were people who already had coverage in the exchange in 2014). HHS had predicted a total enrollment of 14,000 people by the end of the 2015 open enrollment, so the exchange ended up at almost 130 percent of their target.

86 percent of the residents who finalized their enrollments for 2015 were eligible for premium subsidies.

In addition to the private plan enrollments, 2,013 North Dakota residents enrolled in Medicaid or CHIP through Healthcare.gov between November 15 and February 22.

By June, HHS reported that North Dakota’s exchange had 16,651 effectuated (in-force, paid-up) private plan enrollments.  Attrition is a normal part of the individual insurance market, and enrollment is generally expected to decline slowly throughout the “off season” outside of open enrollment.  But according to the ND Insurance Department, effectuated enrollment climbed slightly from June to September, with 16,666 people covered under effectuated policies by mid-September 2015.

Subsidies safe in North Dakota

The Supreme Court issued a ruling in King v. Burwell in June 2015, and the Justices upheld the legality of subsidies in every state, including those that use the federal marketplace (Healthcare.gov). That means subsidies were safe for 14,244 people in North Dakota in 2015, and will continue to be available going forward.  For people who were receiving subsidies in 2015, losing them would have boosted premiums by an average of 169 percent – making coverage unaffordable in many cases.

Even for people who don’t get subsidies, the outcome of a plaintiff win in King v. Burwell would have been grim:  The American Academy of Actuaries estimates that premiums in the entire individual market in impacted states would have increased by at least 35 percent, and possibly as high as 55 percent – in addition to the regular annual rate increases based on medical cost inflation.

Insurers in North Dakota expressed relief that subsidies were upheld, and the ruling is certainly good news for insureds and medical providers. Not surprisingly, however, North Dakota political leaders’ reaction to the ruling was generally split along party lines, with Republicans tending to express disappointment and continuing their call for full repeal of the ACA.

Rates and carriers for 2015

Open enrollment for 2015 started on November 15, 2014, and continued until February 15 (February 22 with the extension that was added for people who had tried to enroll by the deadline). The North Dakota Insurance Department has a healthcare reform page on their website that includes useful information for consumers, including a list of all the North Dakota brokers and agents who are certified to assist people with exchange enrollments.

Three carriers offered policies in the federally-run North Dakota exchange for 2015.  This was unchanged from 2014, and included Blue Cross Blue Shield of North Dakota, Medica and Sanford. But while the three carriers offered a total of 21 plans in 2014, they offered a total of 30 options for 2015.

PricewaterhouseCooper LLC calculated weighted average rate changes from 2014 to 2015 across the entire individual market (on and off-exchange), and found an average price decrease of 3 percent in North Dakota.  But if we look just at silver plans, people who had the cheapest silver plan in the ND exchange in 2014 experienced an average rate increase of about 13 percent in 2015, assuming they didn’t make any plan changes. If they were willing to switch to the new cheapest silver plan however, their rate increase was much more muted, averaging just 4 percent.

And a Commonwealth Fund analysis in December 2014 found an average rate increase of 7 percent (for a 40-year-old non-smoker) across all plans and metal levels in the North Dakota exchange.

North Dakota’s 2014 enrollments

As of April 19, 2014, 10,597 people had enrolled in private plans through the North Dakota exchange.  This was the lowest total of any state in the country, but it was still more than double the number of North Dakota residents who had enrolled as of March 1. 

By of July 6, there were 9,953 enrolled through the exchange in North Dakota.  That’s more than the state reported in mid-May (8,374), but lower than the total at the end of open enrollment because not everyone who enrolled ended up paying their premiums and keeping their new policies. 

Enrollment is expected to be lower in sparsely-populated North Dakota. Despite the low figures, the state decreased its uninsured rate by two percentage points – from 15 percent to 13 percent – during the first half of 2014.

North Dakota Medicaid expansion

In addition to private plan enrollments, by early June 2014 nearly 9,000 low-income North Dakota residents had enrolled in the state’s expanded Medicaid program. North Dakota has followed a unique public-private partnership model of Medicaid expansion, allowing private health insurance carriers to bid for the opportunity to provide health insurance coverage to the state’s newly-eligible Medicaid population using federal Medicaid funds.  Sanford and Blue Cross Blue Shield of ND placed bids, and ultimately Sanford accepted the job.

By October 2015, total enrollment in North Dakota’s Medicaid program had increased by 19,263 people since the end of 2013. That’s a growth of 28 percent, but it includes growth among both the newly-eligible population as well as people who were already eligible prior to 2014 but not enrolled.

Higher than average after-subsidy rates in 2014

A report released by HHS in June 2014 found that 84 percent of enrollees in the North Dakota exchange received premium subsidies, and the average after-subsidy premium in 2014 was $132 per month. This was the second-highest average after-subsidy premium out of the 36 states where HHS was running the exchange in 2014 (only New Jersey was higher, at $148 per month), and was considerably higher than the $82 per month average across all 36 states.

But the higher average net price in North Dakota was a function of enrollees’ incomes and the plans they selected, as the Obamacare premium tax credits do a very good job of evening out premiums across populations with similar household incomes. The average pre-subsidy premium in North Dakota was $350 per month, which is very close to the $346 average pre-subsidy premium across all 36 federally-facilitated marketplaces in 2014.

Grandmothered plans

Following President Obama’s announcement in November 2013 that existing policies could be renewed into 2014 at the discretion of states and carriers, North Dakota’s Insurance Commissioner Adam Hamm decided to go along with the president’s policy cancellation “fix” and urged carriers to provide an option to renew some 36,000 individual policies that had been scheduled to terminate at the end of the year. In May 2014, he extended that allowance following the transitional relief extension issued by HHS in March (permits non-compliant coverage to be renewed until as late as October 2016, and remain in force until as late as September 2017).

But Blue Cross Blue Shield of North Dakota – the state’s largest insurer – opted in December 2014 not to continue to renew policies that had been scheduled for termination. Their insureds had the option to switch to a new ACA compliant BCBS plan, or purchase new coverage from another carrier for 2015.

North Dakota exchange history

The North Dakota House of Representative voted against a state-run health insurance exchange in 2011, and Gov. Jack Dalrymple’s administration reiterated that position in November 2012. But North Dakota expanded its Medicaid program under a provision of the Affordable Care Act. Dalrymple favored the expansion, and the state House approved the measure in February 2012. Enrollment in Medicaid in North Dakota increased by 28 percent from the end of 2013 to October 2015.

North Dakota health insurance exchange links

HealthCare.gov
800-318-2596

State Exchange Profile: North DakotaThe Henry J. Kaiser Family Foundation overview of North Dakota’s progress toward creating a state health insurance exchange.

Get Covered North Dakota

North Dakota Insurance Department
Assists people insured by private health plans, Medicaid, or other plans in resolving problems pertaining to their health coverage; assists uninsured residents with access to care.
(701) 328-2440 / Toll Free: 800-247-0560 / insurance@nd.gov

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