South Carolina health insurance marketplace: history and news of the state’s exchange

BCBSSC's rates decreased slightly in 2020; Molina and Bright joined the exchange, Centene lowered rates slightly and expanded coverage area

South Carolina exchange overview

State legislative efforts to preserve or strengthen provisions of the Affordable Care Act

South Carolina is among the states that have done the least to preserve the Affordable Care Act’s gains.

South Carolina uses the federally run health insurance exchange, so residents enroll through HealthCare.gov.

Open enrollment for 2021 health plans will begin November 1, 2020, and will continue through December 15, 2020. Before open enrollment, South Carolina residents with qualifying events can still enroll or make changes to their coverage for 2020.

(in previous years, Blue Cross Blue Shield of South Carolina has allowed people to purchase plans outside the exchange until the end of December, so for a couple of weeks after open enrollment ends; it’s unclear whether they’ll continue to do this in future years; financial assistance is not available outside the exchange).

Blue Cross Blue Shield of South Carolina was the only insurer offering plans in the exchange in 2018, but Ambetter (Absolute Total Care) joined the exchange in Charleston County for 2019. And for 2020, Molina and Bright Health joined the exchange, bringing the total number of insurers to four.

Average premiums for existing insurers decreased for 2020, Molina and Bright joined the exchange, and Centene/Ambetter expanded coverage area

Two insurers offer plans in South Carolina’s exchange in 2019: Blue Cross Blue Shield of South Carolina, which offers plans statewide, and Ambetter (Absolute Total Care), which offers plans in Charleston County (according to Ambetter’s 2020 rate filing — SERFF tracking number CECO-131968188 — Ambetter/Absolute Total Care had 862 members in 2019; so BCBSSC had the bulk of the market share).

But for 2020, residents in many areas of the state have more options available: Bright Health now offers plans in three counties, Molina offers plans in 20 counties, and Ambetter expanded its coverage area to include a total of 12 counties.

According to ratereview.healthcare.gov, the state’s existing exchange insurers implemented the following average rate changes for 2020:

  • Blue Cross Blue Shield of South Carolina: 3.28% rate decrease (BCBSSC has the vast majority of the state’s enrollment in ACA-compliant individual market plans, and had initially proposed a slight rate increase)
  • Ambetter/Absolute Total Care: 2.28% decrease (Ambetter had just 862 members in 2019, according to SERFF filing CECO-131968188)

BlueChoice, which only offers plans outside the exchange, implemented an average rate decrease of 7.28 percent for 2020. Overall, across the state’s entire individual market, there was an average rate decrease of about 4 percent for 2020.

Here’s a look at how average premiums have changed in South Carolina’s exchange over the years:

  • 2015: Average rate increase of 0.93 percent. Assurant joined the South Carolina exchange for 2015, bringing the total number of carriers in the exchange to five.  Assurant joined the four companies that were already offering health insurance through the federally-run marketplace in South Carolina: Blue Choice Health Plan, Blue Cross Blue Shield of South Carolina, Consumers’ Choice Health Plan and Coventry Health Care of the Carolinas. (this page has more information about the participating carriers).  There were a total of 52 plans available in the state, although not all of them were available in all areas.The South Carolina Department of Insurance found that the weighted average rate increase in the exchange was just 0.93 percent for 2015, and 0.95 percent for the entire individual market. In South Carolina, some people who had the benchmark plan (second lowest-cost silver plan) in 2014 and who switched to the new benchmark plan for 2015 experienced rate decreases for 2015, particularly in the western portion of the state.  In the Greenville area, the benchmark plan as well as the lowest-cost bronze and silver plans were all being offered by a different carrier in 2015 compared with 2014.  And this was the case in much of the rest of the state as well.
  • 2016: Average approved rate increase of 15.9 percent (but it ended up being lower after Consumer’s Choice CO-OP exited the market, as their approved rate increase had been 22 percent). In early October 2015, South Carolina regulators released approved rate changes for 2016. The weighted average rate increase at that point was about 15.9 percent (slightly lower in the exchange, slightly higher when off-exchange plans are included).In the exchange, the highest rate increases were for Coventry (Aetna) and Consumer’s Choice. Since Consumers Choice ultimately ended up not offering plans for 2016, the overall weighted average rate increase ended up being lower than it would otherwise have been.
    Plans in the exchange ended up being available from Coventry/Aetna (in 15 counties), BlueChoice (statewide), BlueCross BlueShield of South Carolina (statewide), and UnitedHealthcare (in five counties; new to the exchange for 2016). Time Insurance, which offered on-exchange plans in South Carolina in 2015, initially requested the steepest rate hike (53 percent), but their parent company, Assurant, subsequently announced that they would exit the individual market nationwide; Time products are no longer for sale in any state.
  • 2017: Average rate increase of 27.8 percent. Coventry (Aetna), BlueChoice (a subsidiary of BCBSSC), and UnitedHealthcare all exited the South Carolina exchange at the end of 2016 (UnitedHealthcare exited the entire individual market in the state, as they did in several other states). Coventry had offered plans in 15 of the state’s 46 counties, and had 8,000 enrollees in 2016. United Healthcare had offered plans in just five counties in 2016. BlueChoice and Blue Cross Blue Shield offered plans statewide in 2016.In South Carolina, the state guaranty fund had to pay $48 million in outstanding claims for Consumers Choice CO-OP members when the CO-OP ceased operations at the end of 2015 (details below). This was a larger outlay than the state had expected. Health insurance carriers contribute to the guarantee fund, and they were allowed to incorporate those fees into their premiums for 2016.
  • 2018: Average rate increase of 31.33 percent. Blue Cross Blue Shield of South Carolina was the only insurer offering plans in the exchange for 2018, as was the case in 2017. The average approved rate increase for 2018 was 31.33 percent. But nearly three-quarters of the total average rate increase was due to the fact that the federal government stopped longer funding cost-sharing reductions (CSR) in the fall of 2017.The cost of CSR was added to on-exchange silver plans in South Carolina. BCBSSC’s rate filing indicated that they are offering separate off-exchange-only silver plans that don’t have the cost of CSR added to the premiums, and all of their non-silver plans (on and off-exchange) are also being sold without the cost of CSR added to the premiums.
  • 2019: Average rate increase of 5.26 percent. This was for Blue Cross Blue Shield of South Carolina, which had been the only insurer in the exchange in 2018. But Ambetter/Absolute Total Care also joined the exchange in Charleston County as of 2019. BCBSSC had 203,000 enrollees in the individual market in 2018, and initially proposed an average rate increase of 9.3 percent. In their filing documents, the first two justifications for the higher rates were the impending elimination of the individual mandate penalty, and the fact that short-term health plans and association health plans were being expanded, both of which were expected to “likely siphon better risks from the ACA market.”In SERFF, it notes that the filing for BCBSSC was “approved as amended.” So although the details of the amended filing (dated August 20) were redacted, presumably BCBSSC updated their filing with a 5.26 percent rate increase, instead of the filing they initially submitted. At ACA Signups, Charles Gaba calculates that rates would have decreased by an average of 5.8 percent if the individual mandate hadn’t been eliminated and if short-term plans hadn’t been expanded.

2020 enrollment: Slight decrease from 2019, down almost 8% since 2016

214,030 people enrolled in plans through South Carolina’s exchange during the open enrollment period for 2020 coverage, which was just slightly lower than enrollment had been the year before.

Here’s a look at how enrollment has changed over the years in South Carolina’s exchange:

  • 2014: 118,324 people enrolled
  • 2015: 210,331 people enrolled
  • 2016: 231,849 people enrolled (peak enrollment; this fits the same trend that applies to most state that use HealthCare.gov, with peak enrollment happening in 2016 and a gradual decline since then).
  • 2017: 230,211 people enrolled (South Carolina’s enrollment decline, at only 0.7 percent, was smaller than the average decline of about 5 percent across all states that use HealthCare.gov)
  • 2018: 215,983 people enrolled
  • 2019: 214,956 people enrolled
  • 2020: 214,030 people enrolled

South Carolina’s CSR approach protects most enrollees, makes non-silver plans particularly appealing

Adding the cost of CSR to on-exchange silver plans while also making off-exchange silver plans available without the cost of CSR added to the premiums is the approach that protects the greatest number of consumers: people who get premium subsidies receive larger subsidies than usual, and people who don’t get premium subsidies have multiple options for plans that don’t have the cost of CSR added to their premiums.

With the cost of CSR added to premiums for silver plans, premium subsidies are larger than they would otherwise be, since the subsidies are based on the cost of the second-lowest-cost silver plan, and grow to keep pace with the increase in silver plan premiums. Due to the larger premium subsidies, bronze plans became very inexpensive starting in 2018, and gold plans are also comparatively less expensive than they were in prior years.

People who aren’t eligible for premium subsidies can purchase plans at other metal levels, or an off-exchange silver plan (people ineligible for a premium subsidy includes those impacted by the Medicaid coverage gap or the family glitch, as well as anyone earning above 400 percent of the poverty level).

So although the bulk of the overall rate increase in South Carolina in 2018 was due to the elimination of federal funding for CSR, the only people who had to bear that cost themselves were on-exchange silver plan enrollees who don’t get premium subsidies, and who chose to keep their silver plan for 2018 instead of switching to an off-exchange plan or switching to a plan at a different metal level.

Despite the fact that the Trump Administration cut off funding for CSR, the benefits of CSR are still available to all eligible enrollees. If your income is between 100 percent and 250 percent of the poverty level and you select a silver plan in the South Carolina exchange, your coverage includes cost-sharing reductions that lower your out-of-pocket costs. The benefits are strongest for those with income below 200 percent of the poverty level.

With the elimination of federal funding for CSR, all that has changed is that the cost of CSR is now being added to premiums, rather than funded directly by the federal government. And because the cost has been added to silver plan premiums in most states (including South Carolina), the added premiums are mostly covered by the federal government anyway, in the form of larger premium subsidies for all enrollees who qualify for premium subsidies.

It’s noteworthy that Blue Choice Health Plan — which only sells off-exchange plans, and thus doen’t have to add the cost of CSR to premiums, since CSR isn’t available outside the exchange — had an average rate increase of just 10 percent for 2018, while BCBSSC’s average rate increase was more than 31 percent. Judging from the rate filing that BCBSSC submitted, their average rate increase for 2018 would also have been around 10 percent if the federal government had continued to fund CSR.

Consumers Choice CO-OP closed at the end of 2015

On October 22, 2015 The South Carolina Department of Insurance announced that Consumers Choice – an ACA-created CO-OP – would wind down its operations by year-end, and would not participate in the 2016 open enrollment period that began November 1. Consumers Choice was the ninth CO-OP to fail, and the fifth in October alone.

The significant shortfall in risk corridors payments was blamed for the CO-OP’s demise, as was the case for all of the CO-OPs that failed since the beginning of October. HHS announced on October 1 that carriers would get just 12.6 percent of the 2014 risk corridors payments that they were owed, leaving many smaller carriers well into the red. One of the other four CO-OPs that closed as a result of the risk corridor shortfall – Community Health Alliance in Tennessee – was also run by Consumers Choice CEO Jerry Burgess.

67,000 Consumers Choice members had to secure new coverage for 2016. The Department of Insurance put together a series of FAQs for impacted plan members. One concern for patients with chronic conditions was the network coverage of the remaining health insurers. None of them included the Medical University of South Carolina in their networks, despite the fact that MUSC is the only place where some patients are able to access specialists for their conditions. MUSC eventually accepted an offer from Blue Cross Blue Shield of South Carolina to cover specialty care for patients who had previously been insured with Consumers Choice, but the agreement had not yet been finalized as of December 29 – just three days before the CO-OP members were to be transitioned to their new plans.

No Medicaid expansion

US Rep. James Clyburn (D – SC) views the ACA as the “Civil Rights Act of the 21st century” and has long called on South Carolina to embrace the law (including Medicaid expansion, which SC lawmakers have thus far resisted) and all that it can offer to the state and its residents.

In his article, Rep. Clyburn noted that SC ranks 43rd in the US in terms of overall health, and points out the myriad ways that the ACA can help to improve residents’ health.

And on the 2016 presidential campaign trail, Ohio Governor John Kasich, a contender for the GOP nomination, called on South Carolina to accept federal funding to expand Medicaid.

In large part because of the state’s failure to expand Medicaid, the uninsured rate in South Carolina is still higher than the national average. According to US Census data, the uninsured rate was still 10.5 percent in 2018 in South Carolina. That was down from 15.8 percent in 2013, but it was still significantly higher than the 8.9 percent national average as of 2018.

And hospitals in South Carolina, particularly in rural areas of the state, are facing closure as a result of a lack of funding — a problem that hospital administrators believe could be addressed by accepting federal funding to expand Medicaid.

Although South Carolina has made no progress so far in terms of expanding Medicaid eligibility, there is one small sliver of good news in the South Carolina Medicaid program: starting in December 2014, adults covered by Medicaid in South Carolina gained coverage for preventive dental coverage, fillings, and extractions with up to $750 in services available for each member per year.

 Grandmothered plans

South Carolina was quick to accept President Obama’s policy cancellation compromise that allowed carriers to extend existing plans that had been scheduled to terminate at the end of 2013.  And when HHS extended that proposal in early 2014, South Carolina was once again among the majority of states that opted to allow grandmothered plans to renew into 2015.

These plans, described as grandmothered or transitional, are allowed to remain in force until the end of 2021, under the terms of the latest federal extension, issued in 2020. South Carolina has agreed to allow carriers to keep grandmothered plans in force until the end of 2021, at the carriers’ discretion.

It has been left up to each carrier to determine whether they wanted to allow their pre-2014 plans to continue to be eligible for renewal. This gives many people — who had individual coverage prior to 2014 — another alternative to compare with the options available in the exchange, but some critics contend that it keeps healthy people out of the new ACA-compliant insurance pools.

Outreach

Three federally funded groups launched training programs and outreach campaigns in 2013 to help consumers understand their options. DECO Recovery Management, Cooperative Ministry, and the Beaufort County Black Chamber of Commerce all received grants to hire “navigators.” Navigators provide unbiased information about the options available through the marketplace and help consumers through the enrollment process, but cannot be directly or indirectly paid by insurance companies.

South Carolina was among the states that received the least amount of federal funding in the initial planning grants — the state got $1 million. This is a thousand times less than the $1 billion that California received (and several other states got hundreds of millions), but was predicated on the state’s refusal to promote the ACA – the money wouldn’t have been utilized by the South Carolina government.

Prior to the 2016 open enrollment period, two navigator organizations in South Carolina received federal grant funding: the Beaufort County Black Chamber of Commerce ($456,102) and the Palmetto Project ($1,123,916).

Navigator funding was sharply reduced by the Trump Administration in 2017 and again in 2018. Heading into the open enrollment period for 2019 coverage (in the fall of 2018), only one organization — DECO Recovery Management — received navigator funding in South Carolina, totaling $300,000. The same organizations also received $300,000 in 2019, prior to the start of the open enrollment period for 2020 coverage.

South Carolina health insurance exchange links

State Exchange Profile: South Carolina
The Henry J. Kaiser Family Foundation overview of South Carolina’s progress toward creating a state health insurance exchange.

South Carolina Consumer Assistance Program
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.
(800) 768-3467  /consumers@doi.sc.gov


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.

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