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

Average premiums increased about 7% for 2020; CareSource expanded into 9 more counties; Cost of CSR continues to be added to plans at all metal levels

Highlights and updates

West Virginia exchange overview

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

West Virginia is one of the states that has done the least to preserve the Affordable Care Act’s provisions.

West Virginia has a partnership exchange, which means residents enroll in exchange plans through HealthCare.gov, but the state oversees the plans that are sold through the exchange.

Open enrollment for 2020 health plans has ended, although residents with qualifying events can still enroll or make changes to their coverage for 2020. The next open enrollment period, for plans effective in 2021, will begin November 1, 2020.

West Virginia accepted federal funding to expand Medicaid under the ACA, so HealthCare.gov enrollees with household income under 138 percent of the poverty level are enrolled in Medicaid rather than private plan.

West Virginia’s exchange had just one carrier (Highmark) in 2014 and 2015. But CareSource joined the exchange in 2016, and both insurers have continued to offer coverage ever since. CareSource has been slowly expanding their coverage area, and their plans are available in 44 counties in 2020, up from 35 in 2019.

From 2016 to 2020, enrollment in private individual market plans dropped by nearly 46 percent in West Virginia. Although there was a nationwide decrease in enrollment during that time period, the drop was much more significant than average in West Virginia.

Funding for marketing and enrollment assistance is far lower in HealthCare.gov states than it used to be, after the Trump administration’s funding cuts. In 2019, just one organization received a navigator grant in West Virginia, totaling $100,000. For perspective, in 2014, three West Virginia organizations received more than $600,000 in navigator funding.

And the free or very low-cost bronze plans that are available in most states for people with low-to-modest incomes are not available in West Virginia. That’s because the cost of cost-sharing reductions (CSR) is spread across the prices for all plans, rather than being concentrated on silver plans and resulting in disproportionately large premium subsidies.

Medicaid expansion enrollment stood at 154,412 as of January 2020. West Virginia has thus-far used an unaltered version of the ACA’s Medicaid expansion, but state lawmakers considered the possibility of seeking federal approval for a Medicaid work requirement for the expansion population (that legislation did not advance in the 2019 session).

West Virginia’s AG is working to overturn the ACA, while simultaneously pushing legislation to protect state residents from those efforts

When the ACA’s individual mandate penalty was repealed under the Tax Cuts and Jobs Act, a group of 18 Republican attorneys general and two Republican governors filed a lawsuit (Texas v. Azar/US), seeking to have the entire ACA ruled unconstitutional (two states have since withdrawn from the lawsuit after Democratic governors took office, so there are currently 18 states challenging the ACA). Their argument is that the individual mandate is unconstitutional without the associated enforcement tax, and the mandate is unseverable from the rest of the ACA — if one falls, the rest falls.

Although that argument might sound tenuous at best, a judge agreed with the plaintiff states in late 2018, ruling that the ACA should be overturned. The case was appealed, but a panel of judges for the 5th Circuit Court of Appeals has agreed that the individual mandate is unconstitutional — although they sent the case back to the lower court to have the judge clarify which portions of the ACA should be overturned.

This ruling essentially just adds additional delay and uncertainty, as it’s not clear how long it will take before the case eventually makes its way to the Supreme Court. In the meantime, nothing is changing about the ACA. But if the law is eventually overturned, it would create utter chaos (and not just for people who buy their own health insurance).

Patrick Morrisey is West Virginia’s attorney general, and is one of the plaintiffs in Texas v. Azar/US, which means he’s part of the group that is actively working to overturn the ACA. But in early 2020, Morrisey and West Virginia State Senate President Mitch Carmichael announced legislation that will be considered in 2020 in an effort to protect West Virginia residents from the very lawsuit that the state is supporting. The West Virginia Healthcare Continuity Act, which would only take effect if and when the ACA gets overturned, would prohibit insurers from rejecting applicants due to pre-existing conditions. It would also require insurers to cover the essential health benefits, and would allow insurers to use limited enrollment windows in order to mitigate risk, just as the ACA does.

In a press conference to announce the legislation, which Carmichael plans to sponsor, Morrisey explained that the bill will be modeled on similar legislation that Louisiana enacted last year (Louisiana is also a plaintiff in the lawsuit seeking to overturn the ACA). In response to a question about how the state would cover the cost (literally a billion-dollar question), Morrisey indicated that West Virginia’s bill would call for the same sort of “invisible risk-sharing” fund called for in Louisiana’s legislation. But under the ACA, West Virginia has more than 150,000 people enrolled in Medicaid expansion (with 90 percent federal funding) and more than 17,000 people receiving premium subsidies that average more than $930/month. If West Virginia enacts the WV Healthcare Continuity Act, it will provide a regulatory framework for health insurance in the state. But without federal funding, it’s unlikely that coverage will be anywhere near as affordable as it is under the ACA.

And it bears repeating that if Morrisey and the other GOP attorneys general in the Texas v. Azar case hadn’t challenged the ACA in the first place, none of this would be necessary in the first place.

Average rate increase of about 6.7% for 2020, plus a CareSource coverage area expansion

Average premiums in West Virginia’s exchange are much higher than the national average. Before any subsidies are applied, the average premium in West Virginia in 2019 was $937/month – versus an average of $612/month across all states that use HealthCare.gov. But the majority of enrollees receive premium subsidies, which averaged $768/month in West Virginia in 2019 – versus $539/month across all states that use HealthCare.gov.

The following average rate increases were implemented for 2020 in West Virginia’s exchange (these increases apply to full-price plans; most enrollees receive premium subsidies that cover the majority of their premiums):

  • Highmark Blue Cross Blue Shield: 5.86 percent average increase (coverage available statewide).
  • CareSource: 9.1 percent average increase (coverage area has been expanded from 35 counties to 44 counties, including nine additional counties: Braxton, Grant, Nicholas, Lewis, Pocahontas, Randolph, Summers, Tucker, and Upshur; CareSource initially only offered plans in 10 counties in 2016, but has expanded their coverage area each year).

The Health Plan of West Virginia (Optum) also offers ACA-compliant coverage in the state, but only outside the exchange so their enrollment is very low. For 2020, HPWV increased their average premiums by 6.48 percent.

Across all three carriers, the average proposed rate increase is 6.7 percent for 2020—versus a national average of less than half a percent.

According to the rate filing documents, the West Virginia Office of the Insurance Commissioner is continuing to require insurers to spread the cost of cost-sharing reductions (CSR) across premiums for plans at all metal levels (the federal government stopped reimbursing insurers for the cost of CSR in late 2017, so the cost has been added to premiums since the beginning of 2018).

This strategy – a broad load – is rare, as most states have opted to have insurers add the cost of CSR only to silver plan rates, resulting in larger premium subsidies for all subsidy-eligible enrollees. But West Virginia continues to be one of just three states—the others are Indiana, and Mississippi – where a broad load strategy is being used. Two additional states – Colorado and Delaware — used a broad load in 2018 but switched to silver loading as of 2019.

When the cost of CSR is added to plans at all metal levels, people who aren’t eligible for premium subsidies are unable to avoid paying the higher prices due to the added premium to cover the cost of CSR. Conversely, when the cost of CSR is added only to premiums for silver plans, premium subsidies go up for everyone, since subsidies are based on the cost of silver plans. But some regulators believe that it’s fairer to spread the cost of CSR across all plans, so that people who want silver plans and aren’t eligible for premium subsidies don’t get stuck paying the full additional cost.

An example helps to illustrate the difference between broad load and silver load. Consider a 40-year-old living in Charleston, WV and earning $30,000 in 2020. He qualifies for $454/month in premium subsidies, but the cheapest plan he can buy is still $149/month after the subsidy is applied.

If he lived in Cincinnati, OH instead, he could get the lowest-priced plan (after-subsidy) for $45/month. And if he lived in Rock Springs, WY, he could pick from among three plans that are free – no premium at all – after the subsidy. There are other dynamics in play here, including the fact that Rock Springs has just a single insurer offering plans, which allows that insurer to carefully design their plans with a substantial price difference between the cheapest plans and the second-lowest-cost silver plan, in order to maximize premium subsidies and ensure that people will have access to free or very low-cost plan options. That’s harder to do in West Virginia, where two carriers offer plans, since neither insurer knows for sure which plan will end up being the benchmark plan until rates are finalized.

But the fact that the cost of CSR has been spread across premiums for all plans in West Virginia — instead of being added only to silver plan rates — is absolutely a factor that makes after-subsidy premiums higher in West Virginia than they are in other areas, since the subsidies are smaller than they would otherwise be.

Rate changes in previous years: 2015 through 2019

2015: Average rate increase of about 7 percent. West Virginia had just one carrier in its exchange in 2015 – Highmark Blue Cross Blue Shield – although the carrier only offered 12 plans in 2014, and bumped that up to 14 in 2015.

In 2014, the lowest-cost bronze plan in the WV exchange was an average of $280/month, higher than the national average of $249. For 2015, the average rate increase in the individual market in West Virginia was 6.7 percent, although there was variation from one plan and region to another, and the average included off-exchange plans as well as plans in the exchange. Because the Kentucky CO-OP filed rates alongside Highmark for 2015, experts believed (and Highmark confirmed) that Highmark was forced to be more competitive with their rates for 2015. Highmark’s rates were not able to be adjusted heading into the 2015 open enrollment, even after the CO-OP withdrew their plan to join West Virginia’s market (and subsequently collapsed altogether). So despite the fact that Highmark remained the only carrier in the state’s exchange in 2015, rates were as competitive as they would have been with a second participating carrier.

2016: Average increase of 24 percent. Highmark initially requested an average rate increase of 19.7 percent for individual plans in the West Virginia exchange, but the requested average rate increase was subsequently changed to 24 percent, and was approved by regulators at that level. Because West Virginia had just one carrier in 2015, it ended up among the three states where one hundred percent of the existing exchange plans requested double-digit rate increases for 2016 (CareSource joined the exchange in 10 counties in 2016).

Highmark noted that they considered pulling out of the exchange at the end of 2015. But the carrier ultimately felt they have a “social mission” to provide coverage to residents in West Virginia. And the 24 percent rate increase that was approved by regulators made it possible for Highmark to continue to offer plans for 2016.

2017: Average increase of 47 percent. Highmark’s average premium increase by 36 percent, and CareSource’s increase by 50 percent. These were steep rate increases, but for the nearly 88 percent of West Virginia exchange enrollees who were receiving premium subsidies, the increases were mostly offset by higher subsidies. But for people with income too high to qualify for subsidies, and for everyone who purchases coverage outside the exchange, the rates were considerably higher in 2017 than they were in 2016.

West Virginia’s average rates were already among the highest in the country, and although average rate increases for 2017 were substantial all across the country, West Virginia’s average rate increases were higher than the national average.

Highmark also introduced tiered a hospital network in West Virginia in 2017; patients who go to a preferred hospital have lower out-of-pocket costs than patients who go to hospitals in the enhanced or standard tiers. Horizon Blue Cross Blue Shield rolled out a similar program in New Jersey in 2016. Tiered network plans tend to be controversial, but the cost-savings is popular with consumers.

CareSource expanded their coverage area to 32 counties as of 2017.

2018: Average increase of 25 percent. Highmark’s average rate increase for 2018 was almost 29 percent, and CareSource’s was 19 percent.

CareSource’s revised filing noted that the West Virginia Office of the Insurance Commissioner had directed insurers to assume that CSR funding would not continue, and to add the cost of CSR to premiums for 2018. But rather than adding the cost of CSR only to silver plan premiums (which is what insurers in most states did), insurers in West Virginia were instructed by the Office of the Insurance Commissioner to spread the cost of CSR across premiums at all metal levels. As noted above, this “broad load” approach is continuing for 2020 as well.

In some parts of West Virginia, the lowest-cost plan available to subsidy-eligible enrollees was actually a little more expensive (after subsidies) for 2018 than it was in 2017, which was particularly rare across the country. The subsidies themselves were larger in West Virginia for 2018 than they were in 2017, but not by as much of a margin as we saw in most states. For example, a 45-year-old in Charleston who earns $35,000/year qualified for a $357/month subsidy in 2018, versus $325/month in 2017. But the lowest-cost bronze plan available to him (after the subsidy was applied) in 2018 was $198/month, versus $180/month in 2017 (this was not the case in most parts of the country—millions of people actually began to have access to free bronze plans as of 2018 due to the large premium subsidies in most areas that stemmed from “silver loading”).

But in other parts of West Virginia, including Lewisburg, Wheeling, and Huntington, the lowest-cost bronze plan for a 45-year-old earning $35,000 was less expensive in 2018 than it was in 2017. Pricing depends on where you live, and there is no one-size-fits-all solution when it comes to health insurance.

2019: Average increase of 9 percent. CareSource expanded their coverage area again, offering plans in 35 counties for 2019. CareSource’s average premium increased by 9.5 percent, while Highmark’s increased by 9 percent. Highmark noted in their filing that they “experienced an unanticipated financial gain in 2017,” after losing money in the ACA-compliant individual market in prior years.

The average benchmark premium (second-lowest-cost silver plan, on which subsidy amounts are based) in West Virginia was 8.7 percent higher for 2019 than it was in 2018. That’s the fifth largest increase across the 39 states that use HealthCare.gov; the average across all of those states was a 1.5 percent decrease for 2019.

Enrollment in West Virginia’s exchange: 2014-2020

Enrollment in West Virginia’s exchange peaked in 2016, and has declined precipitously since then. Here’s a summary of the number of people who have signed up for private individual market coverage through the West Virginia exchange each year, during open enrollment:

Enrollment has generally trended downward since 2016 in states that use HealthCare.gov, but it’s unclear exactly why enrollment in West Virginia’s exchange has experienced such a dramatic decrease. The national average across states that use HealthCare.gov has been a total decrease of about 15 percent from 2016 to 2020, whereas the decrease in West Virginia has been nearly 46 percent.

But part of the explanation could be that West Virginia is one of the few states where the cost of cost-sharing reductions (CSR) was added to plans at all metal levels for 2018, rather than being added only to silver plans. And that continues to be the case as of 2020. Because of this, premium subsidies in West Virginia aren’t as large as they would have been if the cost of CSR had been added only to silver plan premiums, and the super-low-cost (or even free) bronze plans that we’re seeing in many other states aren’t available in West Virginia.

There are various other factors that have contributed to the declining enrollment, including the Trump administration’s decision to sharply reduce funding for marketplace marketing and enrollment assistance, the expansion of short-term plans to serve as an alternative to ACA-compliant coverage, the sharp premium increases in 2017 and 2018 (this primarily only affected people who don’t get premium subsidies, as those who do get subsidies were protected with increasing subsidies), and the elimination of the individual mandate penalty at the end of 2018.

Insurer participation in West Virginia’s exchange

In 2014 and 2015, West Virginia’s exchange had just one carrier—Highmark Blue Cross Blue Shield. West Virginia was the only state in the country that had just one participating exchange carrier in 2015, although Wyoming had just one by 2016, and several states had only one exchange insurer by 2017 (that trend has been reversing itself more recently, with insurers joining the exchanges nationwide for 2019 and 2020).

Starting in 2016, CareSource — a nonprofit insurer — began offering plans with competitive rates in 10 of West Virginia’s 55 counties (Brooke, Cabell, Hancock, Kanawha, Lincoln, Marshall, Mason, Ohio, Putnam, and Wayne). In February 2016, CareSource announced that they had enrolled 1,800 people through the West Virginia exchange for 2016.

CareSource had planned to “significantly” increase the areas of West Virginia where they would offer plans in 2017, and began the process of opening an office in Charleston. For 2016, the vast majority of the state’s exchange enrollees signed up with Highmark, which had the lion’s share of the market in West Virginia—so there was still plenty of room for competition state-wide. For 2017, CareSource had planned to double their membership in West Virginia.

CareSource’s rate filing noted that they offered coverage in the exchange in 10 counties in 2016, but were planning to “expand to additional counties” in 2017. In September 2016, Metro News reported that CareSource would offer coverage in the exchange in 32 counties in West Virginia in 2017. In addition to the ten counties where they offer coverage in 2016, they began offering exchange plans in Barbour, Boone, Calhoun, Clay, Doddridge, Fayette, Gilmer, Harrison, Jackson, Logan, Marion, Monongalia, Pleasants, Preston, Raleigh, Ritchie, Roane, Taylor, Tyler, Wetzel, Wirt, and Wood counties. CareSource’s enrollment more than tripled in West Virginia in 2017.

By 2019, CareSource had expanded to 35 counties, covering the western and north-western areas of the state. And they added nine more counties for 2020: Braxton, Grant, Nicholas, Lewis, Pocahontas, Randolph, Summers, Tucker, and Upshur.

Highmark has continued to offer exchange plans statewide in West Virginia each year. Highmark’s total in-force enrollment in the ACA-compliant individual market in West Virginia was 42,000 as of late February 2016. Most of those enrollees had coverage through the exchange, but the total also included off-exchange enrollments.

And in Highmark’s redacted rate filing memo for 2017, they noted that “These projections reflect expected changes in market share due to an expected increase in market competition” — presumably referring to CareSource’s planned expansion.

Kentucky Health Cooperative (a CO-OP created under the ACA) had planned to expand into the West Virginia exchange in 2015, but in early November 2014, the CO-OP announced that they were postponing their expansion into West Virginia by a year. Then in September 2015, The West Virginia Office of the Insurance Commissioner confirmed that the Kentucky CO-OP would not be offering plans in the West Virginia exchange for 2016.

Ultimately, it was a moot point, as Kentucky Health CO-OP announced in October 2015 that they would cease operations at the end of 2015. The CO-OP is no longer operational.

Grandmothered plans

West Virginia initially did not allow non-grandfathered pre-2014 policies in the individual market to renew again in 2014; they had to be replaced with ACA-compliant coverage as of their renewal date in 2014.

But in April 2014, the state reversed course, agreeing to allow grandmothered (transitional) plans to be renewed as late as 2016.

In February 2016, HHS agreed to give states additional flexibility on grandmothered plans, allowing the plans to renew as late as October 1, 2017, and remain in force until as late as December 31, 2017. States have freedom to accept that proposal as-is, reject it, or implement it with additional restrictions—which is what West Virginia has done

In May 2016, the WV Office of the Insurance Commissioner confirmed by phone that West Virginia was allowing small group transitional plans to remain in force until the end of 2017, at the carriers’ discretion, as long as the plans were renewed by January 2017. The state did not allow small group transitional plans to renew after January 2017—But the OIC noted that there were no longer any grandmothered individual plans in West Virginia, as the state’s carriers had already terminated those plans and replaced them with ACA-compliant coverage.

The state also filed a lawsuit in 2014 against the Obama Administration because the federal government deferred to the states on the decision about whether or not to renew grandmothered plans. A district court found that West Virginia lacked standing in the case, because they did not suffer an injury-in-fact as a result of HHS letting states decide whether or not to allow grandmothered plans to continue to exist. The state appealed that decision.

Then in July 2016, the US Court of Appeals concurred with the district court, ruling that the state lacked standing. The ruling states that West Virginia’s “injury is nothing more than the political discomfort in having the responsibility to determine whether to enforce or not – and thereby annoying some West Virginia citizens whatever way it decides. And no court has ever recognized political discomfort as an injury-in-fact

West Virginia exchange history

Prior to announcing in 2013 that West Virginia would be expanding Medicaid, Governor Earl Ray Tomblin’s administration had hired out cost analyses for both Medicaid expansion as well as setting up a state-run exchange, and ultimately decided that Medicaid expansion would provide more bang for their buck.

So after initially developing plans to operate a state-run health insurance exchange, West Virginia submitted a blueprint for a partnership exchange to the U.S. Department of Health and Human Services (HHS). The blueprint for the West Virginia Health Insurance Marketplace was approved in March 2013.

Gov. Tomblin’s administration cited cost, particularly the expense associated with information technology systems, as a key factor in ultimately deciding against a fully-state-run exchange. Administration officials also said the partnership gives the state some control over the exchange.

Under the partnership, West Virginia is responsible for regulating companies that sell health insurance policies on the exchange.

The state also oversees the In-Person Assister (IPA) program. Assisters are under contract with the state and provide individuals impartial help with the enrollment process. In November 2014, the state announced that it would be hiring an additional 100 people to help residents enroll in the exchange and the state’s expanded Medicaid program.

In December 2014, during the King v. Burwell lawsuit (over the availability of premium subsidies in states—like West Virginia—that use the federally-run exchange) West Virginia’s Attorney General Patrick Morrisey joined AGs from five other states in an amicus brief submitted to the Supreme Court in support of the plaintiffs in King v. Burwell. Despite the fact that about 25,000 West Virginia residents would have lost subsidies if the plaintiffs had prevailed in the case, West Virginia’s Attorney General supported that outcome.

Governor Tomblin made it clear however that he did not support Morrisey’s amicus brief position, and has argued that when the state opted to use the federally-run exchange, they were under the impression that subsidies would be available either way. Ultimately, the Supreme Court ruled that premium subsidies would continue to be available nationwide, including in states that use HealthCare.gov.

Contact the exchange

West Virginia residents enroll through the federally facilitated exchange; 2017 enrollment runs November 1, 2016 through January 31, 2017.

HealthCare.gov
800-318-2596

West Virginia health insurance exchange links

State Exchange Profile: West Virginia
The Henry J. Kaiser Family Foundation overview of West Virginia’s health insurance exchange.