Washington marketplace highlights and updates
- 2018 health care legislation mostly fell short; successful bill will help ensure access to exchange plans
- 243k people enrolled for 2018, a record high for Washington’s exchange
- All counties have coverage options in 2018; 9 counties have 1 insurer
- Seven insurers offering plans for 2018
- 36% average rate increase for 2018, due in large part to federal actions
- Lower silver plan rates could be implemented mid-2018 if CSR funding is allocated
Washington exchange overview
Washington runs its own exchange, Washington Healthplanfinder. Carrier participation in the exchange is robust, with seven insurers offering plans for 2018. The state also has a strong off-exchange market, but subsidies are only available through Washington Healthplanfinder. For insurers that wish to offer plans for 2019, rate and form filings must be submitted to the Washington Office of the Insurance Commissioner by May 24 2018.
Until early 2017, Washington Healthplanfinder was one of three exchanges that allowed QHP enrollments to be completed as late as the 23rd of the month for a first-of-the-following-month effective date. (The other two are Massachusetts and Rhode Island.) But as of April 2017, Washington Healthplanfinder announced that they would be switching to a 15th of the month enrollment deadline, which means they’re now following the same rules that nearly every other state uses.
If you enroll in a plan by the 15th of the month, your coverage will start the first of the following month. If you enroll after the 15th, your coverage will start the first of the second following month. (Note that there are exceptions for certain qualifying events, as is the case nationwide.)
243,000 people enrolled for 2018, far surpassing 2017’s enrollment, and resulting in lower exchange fees for 2019
Nationwide, open enrollment for 2018 coverage began November 1, 2017, and in most states, it ended on December 15, 2017. But state-run exchanges had some flexibility with the dates, as HHS revised the scheduled open enrollment period in April 2017. (It had previously been slated to last three months), and acknowledged that state-run exchanges might not be able to make the changes necessary to switch to the new schedule by the fall of 2017.
Ten state-run exchanges, including Washington Healthplanfinder, extended open enrollment beyond mid-December. Washington Healthplanfinder allowed people to enroll until January 15, 2018.
Total enrollments as of December 15 stood at more than 230,000, a year-over-year increase of 35 percent, and already ahead of 2017’s total enrollment of 225,000 people, despite the fact that there was still a month remaining in open enrollment for 2018 coverage.
By the end of open enrollment, the exchange reported that 242,850 people had enrolled in private plans for 2018, including 78,834 new enrollees. Total enrollment was up 8 percent over the prior year, and dental plan enrollment was up 12 percent.
The exchange published an enrollment report in early February, with data through January 26, indicating that total enrollment had grown slightly, to just over 243,000 people. General enrollment ended on January 15, but people with qualifying events can enroll during special enrollment periods (there’s a special enrollment period through March 1 for anyone who lost off-exchange coverage with Community Health Plan or Kaiser Foundation Health Plan of Washington; people who are eligible for this SEP can enroll in a plan on or off-exchange).
Because of the way Washington handled the elimination of cost-sharing reduction (CSR) funding (adding the cost to only silver plans’ premiums, and letting insurers create new off-exchange only silver plans without the cost of CSR in their premiums), premium subsidies are significantly larger than they were in 2017. As a result, “most customers have a unique opportunity to receive additional tax credits that may cause their 2018 premium costs to be less expensive [than their 2017 premiums]” said Pam MacEwan, CEO of the Washington Health Benefit Exchange.
Washington Healthplanfinder charges a per member per month fee to fund the exchange. For 2016 through 2018, the fee has been $7.46 per member per month. So a family of four has been paying almost $30/month in fees to fund the exchange, as part of their health insurance premiums. But because enrollment grew so much in 2018, and because the exchange has been working to improve its financial efficiency, the fee is being reduced by 55 percent for 2019, to just $3.36 per member per month.
2018 legislative efforts mostly fell short, but one successful bill will help ensure access to coverage in the exchange
Quite a few bills were introduced in Washington’s legislature in 2018 in an effort to transform the state’s health care system to varying degrees. Most of them failed, but one bill, HB2408, was enacted and will help to ensure that plans continue to be available in the exchange.
- SB 6084 (passed Senate, but failed to pass the House before the session ended): Would have created a task force to consider various options for the state of Washington to implement its own individual mandate, requiring residents to maintain minimum essential coverage. The legislation would not have actually created an individual mandate, but would have gotten the ball rolling towards the creation of one. The bill notes that Washington went through an individual market collapse in the 1990s (Washington had passed state-based legislation very similar to the ACA, and subsequently repealed the unpopular individual mandate), and they wish to avoid a repeal scenario. SB 6084 passed the Senate on February 7 by a vote of 25 to 23, but did not advance in the House.
- HB 2408 (signed into law in March 2018): As of 2020, any insurer that offers coverage to school employees will be required to offer at least one silver and one gold plan in the individual market via Washington Healthplanfinder in any areas where the insurer offers coverage for school employees. In the meantime, if necessary, the legislation would make coverage in the Washington state health insurance pool more affordable for people who live in counties where no insurers offer exchange plans. This legislation is an effort to ensure that all areas of the state continue to have options available in the individual market, as Washington came close to ending up with counties with no insurers for 2018.
- HB 2355 and SB6062 (failed to pass by the end of the legislative session): Would have established a state-based reinsurance program in Washington, effective in 2019. The state would have been required to submit a 1332 waiver proposal to HHS in order to seek federal funding for the reinsurance program (This has been approved in other states already. The idea is that premiums drop as a result of the reinsurance program, and the lower premiums result in lower premium subsidies, as well as increased overall enrollment. The federal government then gives the money they would have spent on premium subsidies to the state, to operate the reinsurance program). HB 2355 and SB 6062 had several hearings, but did not pass in their respective chambers. Lawmakers were unable to agree on how the state would fund its own portion of the cost of the reinsurance program.
- HB 2232 (failed to pass by the end of the legislative session): Would have opened up Apple Health (Washington Medicaid) to people who live in counties where there are no health plans available in the exchange. This bill was introduced in the summer of 2017, when it appeared that Washington might indeed have counties without insurers offering exchange plans in 2018. That did not come to pass, but the bill was reintroduced in January 2018. It’s not yet clear whether any areas of the state might be facing a complete lack of exchange plans in 2019, but HB2232 did not advance in the 2018 session.
- HB 2228 (failed to pass by the end of the legislative session): Would have allowed insurers to offer plans that are ACA-compliant but not compliant with additional Washington benefit mandates, in counties where there would otherwise be few or no exchange plans available. Like HB 2232, this bill was introduced in the summer of 2017, when it appeared that Washington might indeed have counties without insurers offering exchange plans in 2018. The bill was reintroduced in January 2018, although it did not advance.
- SB 6102 (failed to pass by the end of the legislative session): Would have required employers that offer health insurance benefits to cover contraceptives, regardless of the employer’s beliefs (the Trump Administration has been working to broaden the religious/personal belief exemptions for employers that wish to offer plans without contraceptive coverage). SB 6102 passed the Senate on February 12, by a vote of 26 to 21, but did not advance in the House.
- HB 2114 (passed in the House, but failed to pass in the Senate by the end of the legislative session): Would have banned balance billing in emergency situations, and in situations where the insured receives care at an in-network facility, but the care includes treatment by an out-of-network provider. This second provision would have been limited to situations involving surgery or “ancillary services,” which is described as anesthesiology, pathology, radiology, laboratory, or hospitalist services. This bill was introduced in 2017 and passed the House but not the Senate. It was reintroduced in the 2018 session, and again passed the House but not the Senate. Washington Insurance Commissioner, Mike Kreidler, championed the legislation, but noted that medical specialists were opposed to it. Kreidler lamented the fact that consumers will continue to bear the brunt of the problem until action is taken to prevent surprise balance billing.
- SB5957 (did not advance in the 2018 session): Would have created a state-based single-payer system to provide universal coverage in Washington. This bill was first introduced in 2017, and reintroduced in 2018. It has a committee hearing in January, but did not advance after that. There are no states that have thus-far established single-payer systems, although Colorado and Vermont have both considered it (Vermont abandoned the idea due to the cost, and Colorado voters rejected the proposal in 2016).
2018: All counties have coverage options; 9 counties have just one insurer
For 2018, Washington Healthplanfinder approved 41 qualified health plans from seven insurers, including 38 renewing plans and three new plans. Every area of the state has on-exchange options available, although nine counties (out of 39 in the state) have just one insurer offering plans: Chelan, Douglas, Ferry, Grays Harbor, Island, Pend Oreille, San Juan, Skagit, and Skamania.
There are seven counties in Washington where there are no bronze plans available in the exchange for 2018: Chelan, Douglas, Ferry, Lincoln, Pend Oreille, Skamania, and Stevens. This means the lowest-cost options won’t be available for people in those areas, and people who would otherwise have purchased bronze plans will have to upgrade to at least silver coverage. Their benefits will be more robust, but their premiums will also be higher.
The approved plans and coverage areas came after several weeks of negotiations between state regulators and the insurers — when rates and plans were originally filed, there were only six insurers with on-exchange plans for 2018, and three of the current insurers had indicated their intent to leave the exchange (ultimately, only two insurers will leave the exchange; the third agreed to remain).
Initially, BridgeSpan and Regence BlueShield had both said they would discontinue their exchange participation and would only offer off-exchange plans after 2017. And another exchange insurer, Community Health Plan of Washington, was exiting the individual market altogether at the end of 2017.
At that point, no individual market insurers had filed plans for 2018 in Klickitat County or Grays Harbor County. So Washington Insurance Commissioner Mike Kreidler began working with insurers to fill in the bare counties. Kreidler’s first success was in Grays Harbor County; he announced on June 19 that Premera had stepped up and agreed to offer coverage there.
And on June 26, Kreidler announced that two insurance companies had agreed to offer exchange plans in Klickitat County, including BridgeSpan. This was particularly notable given that BridgeSpan had initially intended to exit the Washington exchange altogether at the end of 2017. But thanks to Kreidler’s negotiations, BridgeSpan and Molina both agreed to offer plans in the exchange in Klickitat County in 2018. BridgeSpan will also offer off-exchange plans in Klickitat County.
I spoke with the Washington Office of the Insurance Commissioner about the process they went through to entice insurers into Grays Harbor and Klickitat counties. They described daily phone calls and an unflagging determination on the part of Commissioner Kreidler, and also a commitment on the part of the insurers to serve the people of Washington. They noted that most of the insurers are local/regional carriers that have a long history in Washington. None of the insurers knew where other insurers would opt to participate in 2018 before the rates and plans were initially filed in early June. But once it became apparent that no insurers had filed plans for Grays Harbor and Klickitat counties, there was a commitment on the part of insurers and Commissioner Kreidler’s office to solve the problem.
In a June 8 statement about the shrinking insurer participation and coverage areas, Kreidler stated that
“the uncertainty the Trump administration and the GOP-controlled Congress has sowed for months is sabotaging the progress we’ve made. Their actions, including failing to commit to fund the cost-sharing subsidies, not enforcing the individual mandate, and continuing to push in secret the severely flawed American Health Care Act are eroding confidence health insurers have in the market here and across the nation. These actions only increase premiums and decrease insurer participation.”
Washington urged feds to commit to funding CSRs, but 2018 rate filings indicated insurers were skittish
The Washington exchange sent a letter to then-HHS Secretary Tom Price in April, urging him to “take the necessary steps to implement a permanent fix” to the issue surrounding the funding of cost-sharing reductions (CSR). They also asked HHS to consider a national reinsurance program and to adequately enforce the individual mandate — both of which would help to stabilize the individual insurance market.
House Republicans filed a lawsuit (House v. Burwell, now House v. Price) against the Obama Administration in 2014, arguing that the federal funding for CSRs had never been appropriated by Congress, and was being illegally distributed to insurers — to the tune of about $7 billion in 2016. A court sided with House Republicans in 2016, but the Obama Administration appealed and CSR funding continued to flow to insurers across the country until October 2017, when the Trump Administration announced that the funding would end immediately.
The Trump Administration created considerable uncertainty earlier in 2017 in terms of whether CSR funding would continue to be provided, with Trump threatening multiple times to withdraw funding. Without CSR funding, an early-2017 Kaiser Family Foundation analysis indicated that silver plan premiums in the individual market could increase by 19 percent (in addition to all the other variables that drive price increases), and some insurers would simply decide to exit the exchanges or the full individual market.
Washington also joined 14 other states and the District of Columbia in filing a motion to intervene in the CSR lawsuit. Washington’s argument was that a discontinuation of federal funding for cost-sharing reductions would jeopardize the state’s individual market.
2018 rates: 36.4% approved rate increase, due in large part to Trump Administration’s actions
Insurers in Washington had to file rates and plans for 2018 by June 7, 2017. On June 8, Kreidler’s office published a summary of what had been filed (rate filings are available here), and publicized the filing details on June 19. The average proposed rate increase in Washington, before any subsidies were applied, was 22.3 percent at that point. But that was based on the assumption that CSR funding would continue in 2018.
On September 25, Washington Healthplanfinder announced that the exchange had finished certifying plans for 2018, with an average rate increase of 24 percent for plans sold in the exchange (final rate changes available here). At that point, the approved rates were still based on the assumption that CSR funding would continue, but the exchange noted that the premium increases were due to “cost trend and federal uncertainty, particularly enforcement of individual mandate.”
The exchange also explained that the state was taking a unique approach to the CSR funding issue: Regulators approved rates that assumed CSR funding would continue, and those were the rates they intended to implement when open enrollment began on November 1. But they also approved a backup set of rates for on-exchange silver plans, which were high enough to make up for the loss of federal CSR funding. They noted that if CSR funding were to be cut off at some point during 2018, Washington regulators would use their authority to implement the higher on-exchange silver plan rates at that point.
Ultimately, the Trump Administration announced just two weeks later, on October 12, that CSR funding would end immediately. At that point, Washington regulators had to switch to the backup rates, and they announced on October 26 that the higher rates for on-exchange silver plans had been finalized, driving the overall average rate increase up to 36.4 percent.
The Washington Office of the Insurance Commissioner confirmed that if an on-exchange plan is also sold off-exchange, the CSR load would apply both on and off the exchange. They did not adjust all off-exchange plans to make them slightly different from the on-exchange plans in order to confine the CSR load only to exchange plans (that approach is being taken by California). Plans that are only sold off-exchange do not have the CSR load added. And bronze and gold plans sold both on and off the exchange do not have the cost of CSR added to their premiums.
Lower 2018 silver plan rates could be implemented mid-year if CSR funding is allocated
In most states, the cost of CSR had been added to premiums (generally to silver plan premiums) by the time open enrollment began on November 1. We still don’t know whether Congress will allocate funding for CSR in the near future, but it’s a possibility. And indeed, President Trump’s proposed budget calls for funding cost-sharing reductions in fiscal year 2019, which starts in October 2018. If that happens, premiums for 2018 could end up being too high for at least part of the year.
The ACA’s medical loss ratio rebates would eventually sort that out, rebating excess premiums to consumers starting in the fall of 2019. But Washington regulators have clarified that if CSR funding were to be restored at some point during 2018, insurers would revert to the lower-priced silver plans. That could present its own set of problems, however, since people who pick bronze and gold plans during open enrollment are essentially getting a better value for 2018 than they did in 2017, due to the larger premium subsidies.
If the cost of silver plans were to drop at some point in the middle of 2018, premium subsidies would also be lower for everyone in Washington’s exchange for the remainder of the year. Even if enrollees are given a chance to switch plans at that point due to the change in subsidy amounts, it would present a challenge for enrollees, especially those who had already paid some of their out-of-pocket costs for the year.
From the beginning, Washington’s approach was to allow for mid-year rate changes in 2018. In September, when the lower rates (based on CSR funding continuing) were approved, the exchange board noted that if CSR funding were to be eliminated mid-2018, they would implement the higher silver plan rates at that point, and would communicate the details to enrollees. They explained that they would also consider a special enrollment period at that point, which will presumably also be the case if CSR funding gets allocated and the lower silver plan rates end up being implemented in the middle of 2018.
If different rates have to be implemented during the year, a special enrollment period would give enrollees a chance to switch to a different plan to account for the potential reduction in premium subsidies (exchanges can implement special enrollment periods for exceptional circumstances at their discretion).
We are not aware of any other exchanges that are handling the CSR funding issue this way. For the most part, the rates are final once the plans start to be sold, and any changes would have to be worked out during the 2019 rate setting process and with the MLR rebates. There is also still considerable uncertainty in terms of the future of CSR funding. Many consumer advocates have pointed out that restoring CSR funding at this point would do more harm than good, since it would drive down premium subsidies in most states, making coverage less affordable for many exchange enrollees.
2018 rates and plans
Seven insurers are offering on-exchange plans in 2018. The exchange approved 41 plans from these seven insurers, and detailed lists of the counties where each carrier offers plans is here.
In late October 2017, after CSR funding had been eliminated by the Trump Administration, the Washington Office of the Insurance Commissioner published final average rate increases for each insurer, as well as the lower average rate increase that could be implemented at any point in 2018 if CSR funding ends up being restored.
Although those backup rates are considerably lower, it’s worth noting that pre-subsidy premiums for bronze and gold plans would not change at all, even if CSR funding is restored, since the cost of CSR has only been added to silver plans. But for people eligible for premium subsidies, the after-subsidy premiums for bronze and gold plans would change significantly in that case, since the subsidies themselves would be smaller to keep pace with the reduction in silver plan rates.
So essentially, a mid-year restoration of CSR funding would have varying impacts, depending on whether an enrollee gets premium subsidies and what type of plan they have:
- Those with no premium subsidies and bronze or gold coverage would see no change in premiums
- Those with no premium subsidies and silver coverage would see reduced premiums
- Those with premium subsidies and silver coverage would see little or no change in after-subsidy premiums (depending on how their particular silver plan compared with the benchmark silver plan in the area)
- Those with premium subsidies and bronze or gold plans would see higher after-subsidy premiums, due to the smaller subsidies.
It’s essential that all Washington Healthplanfinder enrollees remain vigilant throughout 2018 to make sure that they’re aware of any potential mid-year rate changes.
For now, the cost of CSR has been added to silver plans, and the following average rate increases have been implemented for 2018 (the reduced overall rates that would be implemented if CSR funding is restored are overall averages, but the reduction in premiums would apply to silver plans, with the impact also applying to other metal level enrollees who receive premium subsidies, as described above):
- Coordinated Care Corporation: 45.85 percent (would drop to 30 percent if CSR funding is restored). Coordinated Care Corp is a Centene Company, and as is the case in several other states, they’re expanding their marketplace coverage area for 2018. Their filing includes two new counties (Columbia and Kittitas counties).
- Kaiser Foundation Health Plan of Washington (also filed off-exchange plans): 28.3 percent (would drop to 18.9 percent if CSR funding is restored).
- Kaiser Foundation Health Plan of the Northwest (also filed off-exchange plans): 23.26 percent (would drop to 15.52 percent if CSR funding is restored)
- Lifewise Health Plan of Washington: 33.73 percent (would drop to 26.2 percent if CSR funding is restored)
- Molina Healthcare of Washington: 61.25 percent (would drop to 45.53 percent if CSR funding is restored)
- Premera Blue Cross: 35.51 percent (would drop to 29.71 percent if CSR funding is restored)
- BridgeSpan: 16 percent (the Insurance Commissioner’s report indicates that BridgeSpan is only offering plans outside the exchange, and does not have a different rate listed if CSR funding were to be restored. But a search for 2018 plans in Klickitat County on Washington Healthplanfinder does indeed show BridgeSpan options available for purchase).
As noted above, Chelan, Douglas, Ferry, Grays Harbor, Island, Pend Oreille, San Juan, Skagit, and Skamania counties each have just one insurer offering plans for 2018. And Chelan, Douglas, Ferry, Lincoln, Pend Oreille, Skamania, and Stevens county do not have bronze plans available for 2018. More information about the plans and rates available in each area is here.
Washington Healthplanfinder has expressed concern about the magnitude of the rate increases, and noted that while 60 percent of exchange enrollees in Washington are eligible for premium subsidies that offset all or part of the rate increases, the rest of the exchange population — along with everyone who buys off-exchange coverage — is bearing the full brunt of the rate hikes for 2018 (this is particularly true for silver plan enrollees without premium subsidies, as they experienced the sharpest premium increases). The exchange reiterated the fact that the uncertainty created by the Trump Administration and Congress is directly harming the individual market.
Four other insurers are offering only off-exchange plans, with the following average rate increases:
- Asuris Northwest Health: 25 percent (originally proposed a 31 percent increase)
- Health Alliance Northwest Plan, Inc.: 11.76 percent (originally proposed a 14.6 percent increase)
- Regence BlueCross BlueShield of Oregon: 24.6 percent (originally proposed a 30.9 percent increase)
- Regence BlueShield: 23.3 percent (originally proposed a 30 percent increase)
Insurer exits, exchange mapping, and special enrollment periods
Although some insurers reduced the size of their coverage areas for 2018, only two insurers completely exited the individual market: Community Health Plan of Washington and Kaiser Foundation Health Plan of Washington Options (formerly Group Health Options).
Community Health Plan of Washington participated in the exchange in 2017, but only had 60 enrollees as of 2016. Kaiser Foundation Health Plan of Washington Options only offered coverage off-exchange in 2017, in 12 counties.
Regence BlueShield joined the Washington exchange for 2016 and 2017, but is only offering off-exchange plans in 2018.
Washington Healthplanfinder confirmed that Regence and Community Health Plan enrollees with coverage through the exchange were mapped to comparable plans from other insurers if they didn’t select their own new plans by December 15. The exchange indicated, however, that there would not be a special enrollment period triggered by loss of coverage for these members (in HealthCare.gov states, enrollees whose insurer left the market are eligible for a special enrollment period, despite being mapped to a new plan by the exchange).
But anyone with off-exchange coverage from Community Health Plan or Kaiser Foundation Health Plan of Washington Options is eligible for a special enrollment period triggered by loss of coverage, since there is no entity available to auto-map these individuals to new plans. If they didn’t pick their own new plan by December 31, they’ll were uninsured as of January 1. But their special enrollment period continues until March 1. During that special enrollment period, they can pick any available plan in their area, on or off-exchange.
2017 enrollment: 204k effectuated as of April 2017
By the time 2017 open enrollment ended on January 31, more than 225,000 people had enrolled in private plans (QHPs) through the exchange. The exchange had reported that more than 200,000 people had enrolled during the previous open enrollment period (for 2016 coverage), so the 2017 enrollment represented a 13 percent increase. This is notable, especially given that total enrollment among states using HealthCare.gov was slightly lower in 2017 than it was in 2016 (the Trump Administration reduced advertising for HealthCare.gov in the final week of enrollment, while state-run exchanges like Washington Healthplanfinder were able to continue their advertising efforts as planned).
Enrollments reported at the end of open enrollment included some people who never paid their initial premium to effectuated their coverage. By April 2017, effectuated enrollment in Washington Healthplanfinder QHPs stood at 204,334.
Washington also opted to expand Medicaid under the ACA, and the exchange can enroll people in Medicaid or a private QHP, depending on income. In addition to QHP enrollments, Washington Healthplanfinder had enrolled a total of 1,555,778 people in Apple Health (Medicaid) by February 2017, including renewals (Medicaid enrollment continues year-round). Roughly 600,000 of the Apple Health enrollees are eligible as a result of Medicaid expansion.
Washington’s exchange and the Trump Administration
For the time being, nothing has changed, but there is considerable concern that repealing and replacing the ACA could cause a substantial number of people in Washington to lose their health insurance.
HHS reported that 537,000 people in Washington had gained coverage as a result of the ACA between 2010 and 2015. That number has continued to grow since 2015, particularly in light of the increased enrollment for 2017. In late July, when the Senate voted along party lines to open debate on the health care reform bill, Commissioner Kreidler put out a statement noting that the Senate was “playing with fire” and posing a threat to 700,000 people in Washington who buy their own coverage or receive Medicaid.
But a few days later, the initial push for GOP-led repeal of the ACA stalled when the Senate failed to pass three different versions of the repeal bill that the House had passed in May. But Republicans in Congress are still working to repeal the ACA, and will do so if and when they’re able to muster enough support in the Senate.
2017 rate changes
But overall, the average premium increase in the individual market in Washington was 13.6 percent (nationwide, the average premium increase, before any subsidies are taken into consideration, was about 25 percent). Since the average benchmark premium increase in Washington wasn’t as significant as the average overall premium increase, it was essential for enrollees to shop around during open enrollment, and consider the possibility of switching to a different plan in order to continue to get the best value for 2017.
Since 2014, Washington Healthplanfinder has become more popular with people who don’t qualify for subsidies; 31 percent of the people who enrolled in coverage for 2016 did so without subsidies, up from 18 percent in 2014. As rates increase — both on and off the exchange — the exchange, and its subsidies, become more attractive to more people.
Premera had the largest segment of Washington Healthplanfinder market share in 2016, at 22 percent. And their approved rate increase for 2017 was the highest of any of the state’s plans, at 18.9 percent (a little lower than the 20 percent average increase they had requested).
For 2015, regulators in Washington approved an average rate increase of 1.9 percent; for 2016, the average approved rate increase was 4.2 percent. But regulators said they were not surprised by the higher requested rate hikes for 2017, and the same trend developed in most states.
2017: participating carriers
In 2014, eight insurers offered individual policies through the Washington Healthplanfinder. That grew to ten carriers for 2015 (Columbia United Providers and Moda Health Plan were new to the exchange for 2015, but neither is participating in 2016). For 2016, there were three new carriers that joined the exchange: Health Alliance Northwest, Regence Blue Shield, and UnitedHealthcare of Washington.
Although Moda and Columbia United Providers exited the Washington individual market at the end of 2015, there were still 11 carriers offering individual plans through Washington Healthplanfinder in 2016.
But for 2017, that has declined to nine. Those nine carriers are offering a total of 98 plans through Washington Healthplanfinder. Their 2016 on-exchange enrollment and average approved rate increases are as follows:
- Bridgespan: 5,690 enrollees; 11.9 percent increase (switching to only off-exchange plans for 2018)
- Community Health Plan of Washington: 60 enrollees; 10.6 percent increase (exiting individual market at the end of 2017)
- Coordinated Care: 32,535 enrollees; 7.43 percent increase
- Kaiser Foundation Health Plan of Washington (formerly Group Health Cooperative): 29,272 enrollees; 12.6 percent increase
- Kaiser Foundation Health Plan of the Northwest: 6,822 enrollees; 11.34 percent increase
- LifeWise (a Premera affiliate): 13,173 enrollees; 9.3 percent increase (Lifewise will only offer on-exchange plans in 2017, and is reducing their service area)
- Molina Healthcare of Washington: 22,544 enrollees; 7.35 percent increase
- Premera Blue Cross: 37,104 enrollees; 18.9 percent increase (Premera will only offer on-exchange plans in 2017, and is reducing their service area from 39 counties to 27)
- Regence Blue Shield: 2,022 enrollees; 13.35 percent increase (switching to only off-exchange plans for 2018)
In most cases, the final approved rates vary somewhat from the rate increases the carriers initially proposed.
Numerous carriers across the country exited the exchanges at the end of 2016, and Washington was no exception. Two carriers that offered exchange plans in Washington in 2016 are not participating in 2017:
- Health Alliance Northwest is only offering off-exchange plans for 2017, but only had nine on-exchange enrollees in 2016.
- UnitedHealthcare of Washington exited the exchange and the entire individual market in Washington at the end of 2016, as was the case in most of the states where they offered exchange plans in 2016. United had 2,978 enrollees in the Washington exchange in 2016, or about two percent of the total exchange enrollments.
Plan availability varies from one county to another. LifeWise, Premera, and UnitedHealthcare are the only carriers that offered plans in all 39 counties in Washington in 2016. United exited the individual market altogether at the end of 2016, while Lifewise and Premera have reduced the number of counties where they are offering plans for 2017, and also reduced the number of in-network providers for their plans. This was an effort to move away from fee-for-service payment models and focus instead on value-based care.
Small business coverage – only Kaiser (in two counties) in 2017
Washington Healthplanfinder Business, the state-run SHOP exchange, reported in June 2015 that more than 100 small businesses had enrolled in small group plans for 2015. They also announced that they would make coverage available for businesses with up to 100 employees starting in November 2015. But that changed in October 2015 when President Obama signed HR1624 (the PACE Act) into law. The law repealed the ACA provision that would have expanded the definition of “small group” to include businesses with up to 100 employees. States are free to independently define small groups as businesses with up to 100 employees, but in Washington, Insurance Commissioner Mike Kreidler announced that the state would go along with the PACE Act and continue to define small group plans as those with up to 50 employees.
By March 2016, a total of 174 employers had enrolled in coverage through Washington Healthplanfinder. The plans were covering 606 employees, and 164 dependents. UnitedHealthcare offered small group plans statewide through Washington Healthplanfinder Business in 2016, and Kaiser offered plans in Clark and Cowlitz counties (Moda had planned to offer small business plans state-wide as well, but their last-minute exit from the Washington market at the end of 2015 meant that there was just one state-wide SHOP option in 2016).
And for 2017, United’s exchange exit has left Washington Healthplanfinder’s SHOP exchange limited to only Kaiser, and only in Clark and Cowlitz counties. The state notes however, that there continues to be a robust off-exchange market for small businesses, with 11 insurers offering plans. The small business health insurance tax credit is only available through the exchange. And theoretically, the exchanges provide employee choice for small business enrollees, but that’s of limited value when only one carrier is participating.
Uninsured rate down to 7.3% by 2015
In 2012, the uninsured rate in Washington state was 14.5 percent. According to Washington’s Insurance Commissioner, Mike Kreidler, the uninsured rate had fallen to 7.3 percent by 2015. Only about 522,000 Washington residents were still uninsured in 2015.
Medicaid expansion under the ACA has played a significant role in reducing the number of people without health insurance in the state. 680,000 people have gained access to Medicaid as a result of expansion, although not all of them were uninsured prior to 2014.
Washington Healthplanfinder reported that more than 200,000 people had enrolled in private plans through the exchange by the end of 2016 open enrollment (up from 188,000 as of January 23, and 190,000 as of the middle of the final week of open enrollment). HHS announced that the final enrollment count was 200,691 as of February 1.
To put that number in perspective, 170,101 people enrolled in plans through the exchange during the 2015 open enrollment period (including the special enrollment period in the spring for people who found out they owed a penalty for being uninsured in 2014; if we only consider the open enrollment period, enrollment stood at just under 161,000 during the 2015 open enrollment period), and there were 152,517 people with in-force private plan coverage through Washington’s exchange in October 2015, just prior to the start of the 2016 open enrollment period.
But in 2014 and 2015, Washington Healthplanfinder only included paid enrollments in their total; enrollments that were never paid – and thus never effectuated – weren’t included. For 2016, Washington switched to the method used by most other exchanges, and reported all enrollments including those that had not yet been effectuated with an initial premium payment. This made their enrollment number easier to compare with other exchanges, but harder to make an apples-to-apples comparison between Washington Healthplanfinder’s 2015 and 2016 enrollment data.
Then in June 2016, Washington Healthplanfinder released a detailed enrollment report for the 2016 open enrollment period, and a press release summarizing the details. The exchange reported that 169,182 people had effectuated their coverage (ie, paid the premiums due in order to activate the plan). That’s about an 85 percent effectuation rate, which is similar to what we see across the rest of the country. To compare apples to apples, there were 160,732 effectuated enrollments in the Washington exchange during the 2015 open enrollment period, not counting the tax season special enrollment period that was added that year.
By September 2016, effectuated enrollment had declined slightly, to 166,098. But Apple Health (Medicaid) enrollment had grown to 1,531,402 (including renewals), up from 1,522,342 in March 2016. The exchange notes that prior to 2014, enrollment in Apple Health was a 45 day process. But via Washington Healthplanfinder, that’s been reduced to 45 minutes.
Moda Health, Columbia United Providers no longer in Washington
On October 28, 2015, Moda Health announced they were exiting the Washington market in order to focus on Alaska and Oregon. Effective immediately, they ceased sales and renewal of health plans in Washington, and 47,000 existing policy-holders had to select coverage from a different carrier for 2016.
Moda’s exit is due at least in part to the risk corridor shortfall that was announced by the federal government in October 2015. The carrier had been expecting $90 million, but found out that they would only receive about $11 million. The risk corridor shortfall was directly implicated in the closure of six CO-OPs, and the exit of WINhealth from the individual market in Wyoming and Coventry from the Kansas exchange.
Moda then announced they would also exit the individual markets in Alaska and Oregon in late January, after suffering significant financial losses in 2015. But they were ultimately allowed to resume sales of plans in Alaska and Oregon in early February, and continue to operate in those states (Moda is continuing to offer coverage in Oregon in 2017, but not in Alaska).
In mid-November 2015, Columbia United Providers also announced that they would exit the individual market in Washington. Their plans were only available in Clark County, and they only had about 100 enrollees (all through Washington Healthplanfinder) as of November 2015. Since CUP’s announcement came after the start of open enrollment, some residents in Clark County had already selected CUP plans for 2016. Washington Healthplanfinder reached out to those enrollees and helped them select new plans for 2016. The exchange noted that there are still five carriers offering plans in 2016 in Clark County.
Anyone on a 2015 plan from Moda Health or CUP was eligible for a special enrollment period triggered by loss of coverage, which is a qualifying event. They had until February 29 to pick a new plan, but if they enrolled on January 1 or later, they had a gap in coverage from January 1 until their new plan’s effective date.
Average rate increase just 4.2 percent for 2016
In August 2015, the Washington Insurance Commissioner announced that 136 plans from 12 health insurers had been approved for sale through Washington Healthplanfinder in 2016. A 13th carrier, Coordinated Care Corporation, had also submitted plans to be offered through the exchange, but those rates were still under review at that point; Coordinated Care’s rates were later finalized, and their plans are available for 2016 (Coordinated Care ultimately ended up with the second-highest market share in the exchange, with 19 percent of all enrollments for 2016).
The exchange board also approved all 136 plans to be offered through the exchange, although the last-minute exit of Moda and CUP dropped the total number of carriers to 11 and also reduced the number of plans available. But it was still an increase from 10 carriers and 90 plans in 2015, and eight carriers and 46 plans in 2014. In addition, six carriers are offering eight pediatric dental plans through the exchange in 2016.
The average approved rate increase as of late August was 4.2 percent, lower than the 5.4 percent that had been proposed by health insurers earlier in the summer. Coordinated Care Corporation had requested an average rate increase of 11.2 percent for their 26,000 exchange enrollees, but ultimately the Insurance Commissioner approved a rate increase of 7.2 percent.
The modest rate hike for 2016 comes on the heels of an even smaller average rate increase the year before, when Washington Healthplanfinder’s rates increase by an average of just 1.9 percent for 2015.
For enrollees who shopped around, rates could be lower in 2016 than they were in 2015. A Kaiser Family Foundation study compared benchmark plan (second-lowest-cost silver plan) rates for a 40 year-old in metropolitan areas across the country. In Seattle, the benchmark plan for a 40-year-old was $254 in 2015, and dropped to just $227 in 2016 (the benchmark plan isn’t necessarily from the same carrier that offered it the year before – it’s just the second-lowest-cost silver plan in a given year). That’s more than a 10 percent decrease, and is certainly good news for enrollees who don’t receive subsidies. For those who do receive subsidies, however, average subsidy amounts in Seattle are lower in 2016, since the benchmark plan is less expensive.
Premiums now paid directly to insurers
As of September 24, 2015, insureds pay premiums directly to their carriers; the exchange no longer accepts premium payments. Paying premiums directly to carriers is the norm in most states, but Washington Healthplanfinder aggregated premiums since its launch in October 2013. Enrollees have always had the option of paying premiums directly to carriers, but about 80 percent opted to pay premiums to the exchange. The aggregated premium system used in Washington was different from the standard billing method used in most other states, where insureds pay their premiums to the carriers after enrolling through the exchange.
For the most part, the system worked smoothly in Washington, but a technological invoice problem in 2014 impacted roughly 25,000 enrollments (about 15 percent of the total) and resulted in premiums being paid even though the carrier had no record of the enrollee.
By early October 2014, according to the exchange, nearly all of the billing problems had been resolved, but there were still approximately 1,300 customer accounts that continued to have technical issues. By the time the 2015 open enrollment began in November 2014, the exchange reported that lingering billing problems from 2014 were still affecting about a thousand customers.
But health insurance carriers had a different story to tell. As of October 30, 2014, Premera Blue Cross Blue Shield had 15,000 members whose coverage was in limbo because of billing problems with Washington Healthplanfinder. And the Association of Washington Healthcare Plans estimated that the problems were still impacting about 25,000 insureds state-wide at the end of October.
Because of the billing problems that have plagued the exchange, the board voted 4-3 in mid-December 2014 to remove the exchange from the invoicing/payment collections part of the process, and turn it over to the insurance carriers, the way it’s done in most other states. There was much debate on whether that was the best course of action or not, but ultimately it was decided that carriers would take over the billing process in the fall of 2015, in time for the 2016 open enrollment period (this change was effective September 24, 2015).
In early August 2015, Richard Onizuka announced that he would be stepping down as CEO of Washington Healthplanfinder as of August 31. Onizuka had led the exchange since 2012. Pam MacEwan, who has been Chief of Staff at the exchange since 2012, became the interim CEO, and was appointed as the permanent CEO in February 2016.
Lawmakers reach agreement on exchange funding
Washington Senate Bill 6089 was signed into law by Governor Inslee in July 2015 – but the final version was much different from the original bill. Introduced by Senator Andy Hill (R – 45th District), the legislation was originally designed to significantly cut funding for the exchange. Not only would it have reduced funding for the exchange in the state budget, it would have also prohibited the exchange from receiving any of the state taxes collected on health insurance plans (currently 2 percent of premiums, and that money would have been sent to the state general fund instead of to the exchange), and it would have barred the exchange from getting reimbursement for outreach activities, even if federal funds were available to reimburse exchanges.
But the original bill faced significant push back from the exchange, insurance carriers, and Democrats in the legislature, and it didn’t advance in the House (it passed the Senate on a party line vote, but Democrats have a slight majority (51 – 47) in the House of Representatives). Instead, a rewritten version is much less harsh for the exchange’s funding, but still requires the exchange to actively work to lower costs.
On June 29, lawmakers in Washington reached an agreement on the state’s fiscal year 2016 budget – just in time, as the fiscal year started on July 1. The budget includes $110 million for Washington Healthplanfinder. That’s less than the $127 million the exchange had requested, but the exchange has said the money will be “sufficient.” It does appear that it will require them to run a very tight ship though, with few improvements or upgrades in the near future, and possible reductions in call center staffing.
The money allocated for the exchange comes from state general funds ($11 million) and federal funds ($40 million), along with $58 million from the Washington Health Benefit Exchange Account. That account is funded by the 2 percent premium tax described above, as well as a per member per month carrier assessment. The assessment is currently $4.19 per member per month, but it will need to increase to an estimated $9.78 per member per month in order to generate sufficient revenue.
Open enrollment for 2015 ended in February, although an extension was added for people who weren’t aware that they would fact a tax penalty for not having coverage.
Total enrollment through Washington Healthplanfinder amounted to nearly a million people by the end of open enrollment, including 818,697 Medicaid enrollments.
On April 22, Washington Healthplanfinder announced that total private plan enrollment for 2015 had reached 170,101 people. This is the third-highest total (behind California and New York) of any of the state-run exchanges. All of these enrollees had paid for their coverage; Washington only reported enrollments in 2014 and 2015 if they were paid-up. In most states, the paid enrollment number is about 88 percent of the total plan selections, so it’s likely that there were several thousand additional enrollments that were finalized but hadn’t yet been paid for at that point.
By the end of June, effectuated enrollment in private plans through Washington Healthplanfinder had grown to 170,171. That was about the same as the number of people (170,179) who have individual coverage in Washington outside the exchange.
Of the total private plan enrollments, more than 16,000 had enrolled during the spring special enrollment period that Washington Healthplanfinder offered for people who weren’t able to finish their enrollment by February 15, as well as people who were unaware prior to filing their taxes that the ACA includes a penalty for being uninsured. The special enrollment period ran from February 17 to April 17 in order to cover the whole tax filing season.
In October 2015, Washington Healthplanfinder released updated numbers indicating that effectuated enrollment had dropped to 152,517 people,7 9 percent of whom were receiving premium subsidies that averaged $204 per month. Washington Healthplanfinder also reported that they had facilitated Apple Health (Medicaid) enrollments for 1.4 million people in the two years since the exchange opened for business in October 2013.
75 percent of 2014 enrollees renewed for 2015
On December 31, 2014, total private plan enrollment had stood at 107,071. Of those enrollees, 27,753 were new to the exchange for 2015. The rest had a plan in 2014 and either renewed it or selected a different exchange plan for 2015.
That means about 60 percent of Washington Healthplanfinder’s 130,000 enrollees from 2014 had returned to the exchange to manually renew or make changes to their existing coverage before the end of December. Richard Onizuka, the exchange director at the time, noted in December that while many of those who had not returned to the exchange had unpaid balances on their account, that is “not a barrier to enrollment” for the coming year. If your coverage lapses during the year because you didn’t pay the premiums, you can still come back during open enrollment and sign up for the coming year (this is a provision of the ACA, and applies in every state).
About 80 percent of Washington Healthplanfinder’s 2014 plans were available again in 2015, and the exchange reported in October that roughly 100,000 of their private plan enrollees would be eligible for automatic renewal. But the exchange encouraged the rest of their 2014 enrollees to log back onto the exchange site or use the call center for assistance in updating financial information and confirming a plan selection for 2015.
The benchmark plan (second-lowest-cost silver plan) decreased in price in most of Washington state for 2015. Enrollees who kept the benchmark plan from 2014 saw rate increases that ranged from an average of 2 percent to nearly 11 percent, depending on where they live But enrollees who shopped around and switched to the new benchmark plan were able to secure significant rate decreases instead.
As of March 26, 2015, nearly 67,000 of Washington Healthplanfinder’s 2015 enrollees were new to the exchange, while the rest already had exchange coverage in 2014. At that point, total private plan enrollments stood at about 165,000 people, so roughly 98,000 of them were returning customers from 2014 – about 75 percent of the 130,000 enrollees from 2014.
Another 170k enrolled off-exchange in 2015
In addition to the 170,000 people enrolled in exchange plans in Washington for 2015, another 170,000 enrolled in private plans outside the exchange. While those plans were not eligible for premium subsidies, they’re fully compliant with the ACA’s regulations – they cover all of the essential health benefits, are guaranteed issue (no medical underwriting), and have no lifetime or annual limits on coverage.
Improvements for 2015
Washington Healthplanfinder was hard at work in 2014 to ensure that their second open enrollment period would be even more smooth and successful than their first. The exchange made significant progress on the back-end functionality of the website, improved the transmittal of enrollment and payment data to insurance carriers, and implemented critical code and data fixes to avoid repeats of the isolated – but very frustrating – billing and invoice issues that arose in 2014. As a result of all the fixes, it was expected that there would be far fewer billing, enrollment, and submission errors during the 2015 open enrollment.
From a consumer interface perspective, Washington Healthplanfinder was more user friendly in year two as well. They added screen-sharing functionality with customer support, and additional on-screen definitions to help consumers – especially those who are not familiar with how health insurance works – better understand the enrollment process.
They also added new information on the eligibility screen to make it easier to understand eligibility for each member of a household. This page summarizes the improvements Washington Healthplanfinder has made over the last year.
Consumers also had the option to pay premiums to the exchange using paper checks in 2015, as opposed to 2014 when all payments had to be electronic. Although electronic payments are widely considered to be a convenient method, they can be difficult for low-income residents.
The Washington Healthplanfinder tripled its call center staffing to 500 people during the 2015 open enrollment, and there are also 2,500 brokers in Washington who are certified to help customers enroll in a plan through the exchange.
Washington Healthplanfinder 2014 enrollment
Washington Healthplanfinder announced in September 2014 that 147,888 people were enrolled in private plans through the exchange as of the end of July. The exchange had enrolled 11,497 people with special enrollment periods triggered by qualifying events since between March 31 and July 31, and remained one of the country’s most successful exchanges. A quarter of the people who enrolled were in the 25 – 34 “young invincible” age group.
By the end of July, the exchange had disenrolled a total of 24,072 people because of non-payment, loss of eligibility, or voluntary plan terminations, but that’s an attrition rate of just 6.4 percent. Including Medicaid and private plans, 1,283,670 people were enrolled in plans through Washington Healthplanfinder at the end of July 2014.
As of October, 139,700 people were enrolled in private plans through Washington Healthplanfinder, indicating that their rate of enrollment due to qualifying events had continued at roughly the same pace throughout the summer and fall.
In addition to the private plan enrollments, 909,752 people had enrolled in Medicaid through the Washington exchange by mid-April (nearly half of those people were already enrolled previously, but renewed their Medicaid coverage through the exchange).
Washington Healthplanfinder history
Washington was one of the first states to move ahead with a state-run health insurance marketplace as envisioned by the Affordable Care Act. Former Gov. Chris Gregoire signed legislation creating the state exchange in May 2011. In March 2012 Gregoire signed additional legislation, which further defined how the exchange will be governed and operated.
The Washington Health Care Authority (HCA) helped establish the Washington marketplace. HCA transitioned governing authority to an 11-member board of directors in March 2012. The governor appointed eight voting members and a board chairperson who votes only if needed to break a tie. In addition, the insurance commissioner and the administrator of the Health Care Authority are non-voting members.
In March, 2014, Washington legislators tried to pass a bill that would have created much more transparency in the state’s health insurance industry, providing consumers with data on how much insurers are paying for services in each region of the state. It had widespread support, but opposition from Premera Blue Cross – the state’s largest insurer – sank the bill and Washington did not join the 11 other states that had all-payer claims databases but 2014. But lawmakers persisted, and in 2015, SB5084 was signed into law, advancing the process of creating an all-payer claims database in Washington state.
The federal government funded the Washington Healthplanfinder in 2014. In 2015, marketplace operations was funded by the state with $21 million that was previously earmarked for the state’s high-risk insurance pool, and with an additional tax on premiums on plans sold through the exchange.
According to the U.S. Department of Health and Human Services (HHS), about 835,000 Washington residents could potentially use the new marketplace to purchase private plans (roughly 200,000 had done so by early 2015). The Washington insurance commissioner’s office estimates that 477,400 residents are eligible for subsidies, and state set a target of enrolling 280,000 people in 2014. Obviously it fell short of that amount – and still hadn’t reached it by year three – but enrollment could still grow in the coming years.
No grandmothered plans
Washington Insurance Commissioner Mike Kreidler and Governor Jay Inslee took a strong progressive stance with regards to consumer protections: existing plans that did not meet ACA standards were cancelled at the end of 2013 and needed to be replaced in January 2014 with new, ACA-compliant policies. Following President Obama’s announcement that carriers could extend existing plans into 2014 if states allowed it, Kreidler and Inslee were quick to declare that Washington would not allow non-compliant plans to continue into 2014. Thus, the only non-ACA-compliant individual and small group plans in Washington are grandfathered plans; there are no grandmothered plans.
Contact the Washington exchange
More Washington State health insurance exchange links
Washington Health Benefit Exchange
Information about marketplace planning and development
State Exchange Profile: Washington
The Henry J. Kaiser Family Foundation overview of Washington’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.