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

Molina rejoined the exchange for 2019, BridgeSpan is rejoining for 2020, and Cigna is joining for 2020; average rates are expected to decrease for 2020

Utah exchange overview

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

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

Utah uses the federally run marketplace (HealthCare.gov) for individuals. Open enrollment for 2020 coverage runs from November 1 to December 15, 2019. All plans selected during open enrollment will take effect January 1. (Residents with a qualifying event can shop for ACA-compliant plans outside of open enrollment.)

During the open enrollment period for 2019 coverage, 194,570 people purchased individual market plans through the Utah exchange. That was slightly higher than enrollment for 2018, when 194,118 people enrolled.

Utah partially expanded Medicaid as of April 2019, with coverage available to people earning up to the poverty level—so there is no longer a coverage gap in Utah. Voters in Utah approved a ballot initiative in 2018 calling for Medicaid expansion, but lawmakers in the state acted quickly to limit the expansion. The state had hoped the federal government would provide the full expansion-level funding (a 90/10 split as of 2020) despite a partial expansion (ie, not expanding coverage to include people earning up to 138 percent of the poverty level), but CMS rejected that proposal. Utah plans to implement a Medicaid expansion work requirement in 2020, and is seeking federal approval for various other restrictions. If those are not approved by mid-2020, however, full Medicaid expansion will be implemented in Utah.

2020 rates and plans: BridgeSpan rejoining exchange, Cigna joining, Molina expanding coverage area

BridgeSpan is rejoining Utah’s exchange in 2020, with on-exchange plans that will be available in Weber and Davis counties. BridgeSpan had previously participated in the exchange, but had exited at the end of 2015 and only offered plans outside the exchange from 2016 through 2019 (plans are available outside the exchange in 17 of Utah’s 29 counties in 2019).

And Cigna is joining Utah’s exchange for 2020, although it’s not yet clear which counties will be in their coverage area.

Molina currently offers plans in nine counties in northern and southwestern Utah: Cache, Weber, Davis, Salt Lake, Summit, Toole, Utah, Iron, and Washington). For 2020, their coverage area will grow to include 13 counties, with coverage newly available in Rich, Box Elder, Wasatch, and Morgan counties.

[Some details regarding 2020 coverage areas are available on the federal rate review website.]

So five insurers will offer plans in Utah’s exchange. Four of them have proposed average rate decreases (Cigna is new to Utah’s market, so there is no applicable rate change for their products):

  • Molina: 11.54 percent average decrease (Molina only has 448 enrollees in 2019; Molina is only offering gold and silver plans for 2019, but will also offer bronze plans for 2020).
  • SelectHealth: 2 percent average decrease. Plans are available statewide in 2019.
  • University of Utah Health Plans: 1.15 percent average decrease. Plans are available statewide, but with different networks depending on the county.
  • BridgeSpan: 10.23 percent average decrease (applicable to current off-exchange plans; BridgeSpan will offer new plans in the exchange in 2020 in Weber and Davis counties).
  • Cigna: New to Utah’s market, so no applicable rate change.

As was the case in the past two years, insurers are adding the cost of cost-sharing reductions (CSR) to on-exchange silver plan rates for 2020. This approach is beneficial for consumers, as it results in disproportionately high silver plan premiums and correspondingly large premium subsidies (since subsidy amounts are tied to the cost of the benchmark silver plan).

Regence, which only offer plans outside the exchange, has proposed an average rate decrease of 10 percent for 2020. At ACA Signups, Charles Gaba calculated an average proposed rate decrease of 5.9 percent for 2020, but that’s mostly an unweighted average since the publicly available filing details from most of the insurers do not include membership totals

2019 rates, carriers and plans

Molina exited Utah’s exchange at the end of 2017, but rejoined the exchange for 2019. On-exchange plans are available in Utah for 2019 from three insurers: Molina, SelectHealth, and University of Utah Health Insurance Plans. Two other insurers — Regence and BridgeSpan — only offer plans outside the exchange, but as noted above, BridgeSpan will offer on-exchange plans in the Odgen area in 2020.

A quick backstory on Molina: The insurer offered 2017 exchange plans in nine states (California, Florida, Michigan, New Mexico, Ohio, Texas, Utah, Washington, Wisconsin). By June 2017, they had submitted initial filings for 2018 plans in all nine of those states. But their second-quarter report noted that marketplace performance had been “most disappointing” in four states: Florida, Utah, Washington, and Wisconsin.

Molina explained that during the second quarter, medical costs amounted to 127 percent of premiums collected for exchange plans in Utah and Wisconsin — a clearly unsustainable amount (for reference, the ACA requires individual market insurers to spend at least 80 percent of premiums on medical costs and quality improvement; anything over 100 percent means that the insurer is spending more on claims than they’re collecting in premiums, and that’s before administrative costs have been paid).

As a result of the unsustainable losses, Molina exited the exchanges in both Utah and Wisconsin at the end of 2017. But they rejoined both states’ exchanges for 2019. Their Utah rate filing for 2019 indicated that they had more than 69,000 enrollees in the state in 2017, although they did not have any in 2018. [Technically, Molina did not completely exit the individual market in Utah in 2018. They continued to offer one off-exchange gold plan, but it was not actively marketed and did not have any enrollees.] By 2019, after rejoining the exchange and offering plan in nine counties, Molina had 448 enrollees, so their market share is a very small fraction of Utah’s ACA-compliant individual market.

The following average rate changes were approved for 2019 individual market plans:

  • Molina: 23.3 percent increase (this didn’t directly affect any enrollees, as Molina did not have any enrollment in 2018).
  • SelectHealth: 2.62 percent decrease. Plans are available statewide.
  • University of Utah Health Plans: 0.72 percent increase or a 0.62 percent decrease, depending on the plan. Plans are available statewide, but with different networks depending on the county.

Larger premium subsidies result in lower premiums for many enrollees

Because the cost of CSR has been added to silver plan premiums in Utah, silver plan premiums increased by much larger percentages than the premiums of plans at other metal levels. Premium subsidies (premium tax credits) are based on the cost of the second-lowest-cost silver plan, so they grow to keep pace with the price of silver plans. The addition of the cost of CSR to silver plan premiums thus resulted in much larger premium subsidies starting in 2018.

For people who select silver plans (including anyone eligible for CSR benefits who wants to partake of those benefits), the larger premium subsidies keep the after-subsidy cost of silver plans roughly comparable to what it was prior to 2018. But for people who buy plans at other metal levels, the larger premium subsidies make their after-subsidy rates much more affordable than they were in 2017 and earlier years.

As an example, consider a 45-year-old living in Salt Lake City. If he earns $25,000 in 2019, he can get bronze plan for as little as 13 cents a month in premiumsAnd he can choose from among six different bronze plans that are all priced under 20 cents per month.

In contrast, a 45-year-old in Salt Lake City earning $25,000/month would have had to pay at least $67/month in premiums for a bronze plan in 2017.

That drop in after-subsidy premiums — from $67 a month to under 20 cents a month — is due to the fact that the insurers have added the cost of CSR to silver plan rates in 2019. They did the same thing for 2018, and a 45-year-old in Salt Lake earning $25,000 could get a bronze plan for as little as 33 cents a month in 2018.

Residents in the counties where Molina is offering coverage can select from among all three carriers for 2019 coverage. A 40-year-old living in Cache County, earning $30,000 in 2019 will qualify for a subsidy of $406/month. She can select from among 25 plans—six of which have after-subsidy premiums of less than $5/month. The very low-cost plan options are a direct result of the cost of CSR being added to silver plan rates, driving premium subsidies higher than they would otherwise have been.

2018 rate filings – rate filings in Utah had to assume no CSR funding

The following average rate increases were implemented for 2018 in Utah’s exchange:

  • SelectHealth: 44 percent overall average rate increase. But the average increase was just 14 percent for bronze and catastrophic plans, and 21 percent for gold plans. Much of the overall average increase was driven by the fact that silver plans increased in price by an average of 57 percent. This is because the cost of CSR was added to silver plan rates for 2018. SelectHealth covered 119,094 people on their ACA-compliant individual market plans in 2017.
  • University of Utah Health Plans: 30.8 percent. The rate filing summary noted that “UUHP’s premium increase is primarily tied to the potential loss of Cost Share Reduction subsidy payments” and the cost of CSR was added to silver plan premiums for 2018.

Cost-sharing reductions (CSR) reduce out-of-pocket costs for low-income enrollees who pick silver plans. Until October 2017, the federal government reimbursed insurers for the cost of providing better coverage to these enrollees, but the funding became the subject of a lawsuit in 2014. House Republicans sued the Obama Administration, arguing that the money for cost-sharing reductions was never appropriated by Congress. They won the lawsuit in 2016, but the Obama Administration appealed and the money continued to flow to insurers until the Trump Administration terminated it in October 2017.

In the spring and summer of 2017, however, states and insurers didn’t know what action the Trump Administration would ultimately take—and the question of CSR funding was crucial to the rate-setting process for 2018. The Utah Insurance Department issued a bulletin on June 2, clarifying that insurers’ rate filings should be based on the assumption that cost-sharing reductions would not continue to be funded in 2018. This is the approach that nearly every state ended up taking by October (especially after the Trump Administration officially terminated CSR funding), but it was a fairly rare approach in early June. The idea was that if the Trump Administration or Congress had committed to funding cost-sharing reductions over the summer, insurers in Utah would have been able to file new rates, reflecting the change. But that did not happen.

As described above, silver plan rates became disproportionately high in 2018, and that has continued in 2019. The result is disproportionately large premium subsidies, making coverage even more affordable for people who qualify for premium subsidies and select a non-silver plan.

Rate changes in previous years

For perspective, here’s a look at how premiums changed in Utah’s individual market starting in 2015:

2015: Average rate increase of 5.7 percent (an analysis by the Commonwealth Fund put the increase slightly lower, at 5 percent). Rate increases were slightly higher in rural areas (about 7 percent). Across the entire individual market, including on and off-exchange policies, the weighted average rate increase in Utah was 7.6 percent for 2015.

The modest rate increases were especially good news considering rates in Utah were already lower than the national average. For 2014 plans, across all age groups, the average lowest-cost bronze plan in Utah was $201/month before subsidies, compared with a national average of $249. A report released in February 2014 found that Davis and Salt Lake were among the least expensive regions to purchase health insurance in the US in 2014; the two-county region ranked 7th on a list of the ten least expensive health insurance areas.

2016: Three carriers offered plans in Utah’s exchange for 2016. Humana increased their premiums by an average of 24 percent, Molina decreased theirs by an average of 0.34 percent, and SelectHealth increased premiums by an average of 16.7 percent. Average benchmark premiums (second-lowest-cost plan premiums) increased by 15.8 percent in Utah for 2016.

2017: 31 percent average increase. For the three carriers (SelectHealth, Molina, and UUHP) that offered individual plans in the exchange in Utah in 2017, the weighted average approved rate increase—across on and off-exchange enrollment—was 31.1 percent. But that has to also be viewed in light of the fact that Utah’s 2016 premiums were far lower than the national average in 2016.

Once plan selections for 2016 were finalized, the average pre-subsidy premium was just $271/month, which was by far the lowest of the 38 states that used Healthcare.gov in 2016 (the second-lowest was Arizona, at $324/month; the average pre-subsidy premium across the 38 Healthcare.gov states in 2016 was $396/month). Jaakob Sundberg, an actuary for the Utah Department of Insurance, explained that health insurance coverage in Utah “was definitely underpriced prior to this [2017 rate hikes]” and said that the 2017 rates were the first time he saw appropriate pricing for ACA-qualified plans in Utah.

The Utah Insurance Department has a comprehensive website explaining the rate review process, and rates for a 21-year-old for each plan in each county (the rates don’t take subsidies into account; after subsidies, rates are lower).

Insurer participation in Utah’s exchange: 2014-2019

On October 27, 2015—just five days before the start of the 2016 open enrollment period—the Utah Department of Insurance announced that Arches Health Plan (an ACA-created CO-OP) had been placed in receivership and state regulators would oversee the winding down of the carrier’s operations. Existing members (roughly a quarter of Utah’s exchange enrollees in 2015) had to select coverage from another carrier in order to have coverage in place on January 1.

In addition to Arches closing their doors, two smaller carriers in Utah—BridgeSpan and Altius (Coventry/Aetna) exited the exchange at the end of 2015 (for all three carriers, the risk corridor shortfall announced in October 2015 was a major factor). Bridgespan and Altius continued to offer plans outside the exchange in Utah in 2016 (as noted below, BridgeSpan is rejoining the exchange for 2020 in Weber and Davis counties).

But University of Utah Health Plans joined the exchange for 2016, with coverage available in nine counties (Salt Lake, Utah, Weber, Davis, Tooele, Box Elder, Wasatch, Morgan, and Summit). UUHP continued to expand their coverage area, offering plans in 16 counties in 2017 and expanding to all 29 counties in 2018 (UUHP members with exchange coverage use the Healthy Preferred network in Salt Lake, Davis, and Utah counties, and the Health Premier network in the rest of the state).

With three carriers leaving the exchange and one joining, Utah had a total of four carriers offering individual plans through the exchange in 2016: Humana Medical Plan of Utah, Molina, SelectHealth (only insurer offering plans statewide as of 2016), and University of Utah Health Plans

Humana exited the exchange at the end of 2016, leaving three insurers offering plans for 2017. And Molina left at the end of 2017. So for 2018, SelectHealth and UUHP were the only insurers offering plans in Utah’s exchange.

But Molina rejoined the exchange in 2019, BridgeSpan is rejoining the exchange for 2020, and Cigna is also joining the exchange for 2020, bringing the total number of participating insurers to five in Utah’s exchange.

Exchange enrollment: 2014-2019

The majority of states that use HealthCare.gov saw a decline in enrollment from 2016 to 2017, but Utah bucked that trend, and had the third-highest year-over-year enrollment growth. For 2018, average enrollment declined by about 5 percent in states that use HealthCare.gov. While Utah did see a slight decline for 2018, it was far smaller than the average. And enrollment in Utah’s exchange grew slightly for 2019, whereas average enrollment across all the states that use HealthCare.gov declined in 2019.

Here’s a summary of enrollment totals for each year (during open enrollment) in Utah’s exchange:

Grandmothered plans

The Utah Department of Insurance accepted the Obama Administration’s March 2014 offer to allow pre-2014 (but non-grandfathered) health plans to be extended, and by June 2014, the state’s two largest insurers had also accepted the offer.

Regence Blue Cross and Blue Shield and SelectHealth—covering a total of 60 percent of the individual health insurance market in Utah—both allowed their members with pre-2014 plans to renew their coverage in the fall of 2014.

Insureds with grandmothered plans eligible for renewal can opt to switch to an ACA-compliant plan instead, either during general open enrollment or when their plan renews (renewal of an individual plan outside of general open enrollment is a qualifying event that triggers a special enrollment period).

Grandmothered plans were initially only extended for a year, but that extension has been renewed every year since, with the final decision left up to each state. Utah has gone along with all of the extensions, and grandmothered plans are currently allowed to remain in force until as late as the end of 2020.

SHOP exchange for small businesses

Along with Massachusetts, Utah had a health insurance exchange that predated the Affordable Care Act. However, unlike the exchanges called for by the Affordable Care Act, Utah’s exchange was not open to individual consumers to purchase health insurance. That fact led to a series of discussions and negotiations between the state and the U.S. Department of Health and Humans Services (HHS), and ultimately, a unique approach to running the exchange; Utah would run the small business exchange, while the federal government would run the individual exchange via HealthCare.gov.

According to an article in The Salt Lake Tribune, by August 2013, about 350 businesses were providing health insurance to about 7,800 people through Avenue H.

In 2015, small-businesses had their choice of 75 plans from three carriers on Avenue H (Arches Mutual Insurance, SelectHealth and UnitedHealthcare of Utah), and 576 plans from seven companies that are selling small group plans outside the exchange. In 2016, Arches Mutual plans were no longer available — on or off the exchange — as the CO-OP shut down at the end of 2015.

The Utah Health Reform Task Force voted in October 2016 to turn over the state’s small business exchange to federal control, as it was costing $1.5 million in annual operating expenses. As of late 2016, Avenue H had 800 participating small businesses, with about 14,500 people enrolled. By 2017, there were two participating carriers (SelectHealth and HSA Health Plan) and only 28 available plans.

The state moved forward with the task force’s recommendation, and Avenue H stopped enrolling new groups and renewing existing groups after the end of 2017. New groups began enrolling through the federally-facilitated SHOP exchange at the end of 2017, but the federal platform had also switched to a direct-to-carrier approach in all states where it operates.

Contact the exchange

HealthCare.gov
Use the federal marketplace to enroll in individual or family coverage

More Utah health insurance exchange links

Health Insurance Division Consumer Service
Assists consumers who have purchased insurance on the individual market or who have insurance through an employer who only does business in Utah.
(801) 538-3077

Office of Consumer Health Assistance (OCHA)
Serves residents with health care complaints.
(801) 538-9674 / Toll-Free: 1-800-439-3805 / health.uid@utah.gov

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


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.