New carrier joins WV exchange
In 2014 and 2015, West Virginia’s exchange had just one carrier – Highmark Blue Cross Blue Shield. West Virginia is the only state in the country that had just one participating exchange carrier in 2015.
But for 2016, CareSource will also be offering plans in 15 of West Virginia’s 55 counties (Boone, Brooke, Cabell, Clay, Hancock, Kanawha, Lincoln, Marshall, Mason, Ohio, Pleasants, Putnam, Wayne, Wirt, and Wood).
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, saying that they needed additional time to make sure that the new West Virginia Health Cooperative would be fully functional before being offered for sale in WV.
But Kentucky CO-OP stays away
But in September 2015, The West Virginia Office of the Insurance Commissioner confirmed by phone that the Kentucky CO-OP will not be offering plans in the West Virginia exchange for 2016. The CO-OP has the majority of the market share in Kentucky’s health insurance exchange, and the Kentucky Department of Insurance approved the CO-OP’s average rate increase of 25 percent for 2016.
It is unclear whether Kentucky Health Cooperative might eventually enter the West Virginia market – at this point, the WV Insurance Commissioner’s office said that there are no long-term plans to do so.
Highmark has requested an average rate increase of 19.7 percent for individual plans in the West Virginia exchange. The proposed rate changes vary from about 17 percent to almost 22 percent depending on the plan, but because West Virginia has just one carrier in 2015, it ended up among the three states where one hundred percent of the exchange plans have requested double digit rate increases for 2016.
Highmark’s rates have not yet been approved by regulators in West Virginia. For residents of the counties where CareSource will be offering plans in 2016, there will be some competition and choice. But in the other 40 counties, Highmark will remain the only option. The good news for the vast majority of exchange enrollees is that if the price of the second-lowest-cost silver plan increases, subsidies will increase commensurately, just as they did for 2015.
ACA subsidies are safe
Because West Virginia has a federally-run exchange, the continued availability of subsidies depended on how the Supreme Court ruled in King v. Burwell. Fortunately for the residents, insurers, and medical providers of West Virginia, the Court ruled that subsidies are legal in every state, so West Virginia’s reliance on Healthcare.gov no longer puts subsidies in jeopardy.
The Urban Institute had estimated that if subsidies were eliminated in states that use the federally-run exchange, the individual market population in those states would drop by 70 percent. 25,000 people would have lost their subsidies in West Virginia, and their premiums would have increased by an average of 234 percent. Even for those not currently receiving subsidies, premiums would have skyrocketed – by about 55 percent, not counting the normal annual rate increases- because healthy people would have been more likely to drop their coverage if it became unaffordable.
State-run exchange costly and unlikely
West Virginia is one of 23 states where leadership’s opposition to the ACA is strong enough that there was little chance of an agreement to create a state-run exchange if subsidies were eliminated in the federally-run exchange.
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.
Now that subsidies are no longer in jeopardy in the federally-run exchange, there is little incentive for states to spend the money and resources necessary to create their own exchanges. Not only will West Virginia likely continue to use the federally-run exchange, some states that currently have state-run exchanges might eventually switch to Healthcare.gov instead.
AG supported elimination of subsidies
Incidentally, West Virginia’s Attorney General Patrick Morrisey joined AGs from five other states in December 2014 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.
2015 enrollment numbers
33,421 people enrolled in private plans through the West Virginia exchange during the 2015 open enrollment period (through February 22). 86 percent qualified for premium subsidies, and 49 percent are new to the exchange for 2015. The other 51 percent are people who had plans in 2014 and either renewed them or selected a different exchange plan for this year.
HHS had projected 25,000 private plan enrollees in the West Virginia exchange by the end of open enrollment, and at ACAsignups, Charles Gaba set a higher projection: 31,000 enrollees by February 15. Enrollment reached nearly 134 percent of the HHS projection, and even exceeded Gaba’s prediction (although the final count reflects a week-long extension that HHS added to allow people additional time to finish their enrollments).
But some enrollees didn’t pay their initial premiums, and others have cancelled their coverage mid-way through the year. In addition, Healthcare.gov stepped up enforcement of immigration/financial documentation requirements in 2015, resulting in more real-time disenrollments and subsidy adjustments. By the end of June, effectuated enrollment in private plans through the West Virginia exchange stood at 31,106 people.
An additional 5,063 people enrolleed in Medicaid or CHIP through the exchange between November 15 and February 22. From the end of 2013 to June 2015, total enrollment in Medicaid/CHIP grew by 184,057 people in West Virginia – a 52 percent increase.
Open enrollment for 2015 has ended, and most people can only purchase coverage (on or off exchange) at this point if they have a qualifying event (Native Americans can enroll year-round, as can applicants who qualify for Medicaid or CHIP). The next open enrollment period begins on November 1, for coverage effective January 1, 2016.
2015 rates and plans
West Virginia had just one carrier in its exchange – Highmark Blue Cross Blue Shield – although the carrier only offered 12 plans in 2014, and bumped that up to 14 in 2015.
By December 31, 2014, Highmark Blue Cross Blue Shield reported that they had enrolled 31,100 people in 2015 plans, including on and off-exchange policies, and renewals from 2014. But it wasn’t clear what percentage of those plans were purchased outside the exchange (by January 16, a total of 27,471 people had purchased plans inside the exchange, so clearly there were several thousand off-exchange plans purchased by December 31). Off-exchange plans must be fully ACA-compliant, but if you enroll outside the exchange, you’re not eligible for subsidies.
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 is 6.7 percent, although there is variation from one plan and region to another, and includes 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 has 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 pulled out of the WV market. 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.
Because the exchange only had one participating carrier, there wasn’t as much to be gained as there was in other states by shopping around again during the 2015 open enrollment. The NY Times Upshot showed that people who had the benchmark plan (second lowest cost silver plan) in 2014 saw an average rate increase of 9 percent in most of West Virginia for 2015. Since the benchmark plan isn’t changing to a new carrier, there was no option to switch to a cheaper plan, unless they wanted to go with the lowest-cost silver plan or a bronze plan.
Across all metal levels in the exchange, a Commonwealth Fund analysis found an average rate increase of 10 percent for a 40 year-old non-smoker in West Virginia. Of course, most enrollees qualify for subsidies, and the subsidies rose to keep pace with the increase in price for the benchmark plan.
The ACA’s impact in West Virginia
Although West Virginia opted to let HHS run the exchange, the state chose to expand Medicaid under the ACA, and has been working diligently to enroll as many people as possible in expanded Medicaid. Their efforts have paid off: In 2014, the state had the second-highest increase in Medicaid/CHIP enrollment in the country (Oregon was first).
By June 9, 2014, West Virginia had 508,496 residents (about 27% of the state’s population) enrolled in Medicaid or Children’s Health Insurance Program. And as of mid-September, 2014 reports indicated that the state had enrolled virtually all of the people who were eligible for expanded Medicaid. Medicaid enrollment continues year-round, so any remaining eligible residents can enroll at any time.
In 2013, about 17 percent of the West Virginia population was uninsured. By July 2014, that number had fallen to 6.6 percent, and the reduction is due almost entirely to the ACA. Another study in 2015 confirmed similar data, pegging West Virginia’s uninsured rate at 6.59 percent.
In a study conducted by Wallet Hub, West Virginia is currently ranked second in the nation in terms of how much the states and their residents benefit from Obamacare. If all provisions of the law were fully implemented in every state (including Medicaid expansion, which West Virginia has already implemented), West Virginia would rise to the top of the list as the state the benefits the most from the ACA.
Anti-ACA legislation didn’t advance
Despite how much the ACA has helped West Virginia, lawmakers introduced a pair of anti-ACA bills shortly after the 2015 legislative session convened. HB 2216 would give only the legislature the authority to create a state-based health insurance exchange – the Governor would not be able to create an exchange without legislative approval if HB 2216 passes. The bill was approved by the House Health and Human Resources Committee in a 14 – 9 vote on January 27, but it didn’t advance after that.
And HB 2509 goes a step further – it would invalidate the ACA in West Virginia. This bill was also reviewed by the House Health and Human Resources Committee, but did not advance to the House floor.
How many people enrolled in 2014?
In addition to Medicaid and CHIP enrollments, 25,856 people had completed their private plan Obamacare enrollments by early July 2014, which represented an increase of about 6,000 people since the end of the 2014 open enrollment period (qualifying events trigger special enrollment periods for private plans.)
Another 6,171 people had enrolled directly (outside the exchange) through Highmark Blue Cross Blue Shield – the only carrier offering 2014 plans in the WV exchange – between October 1 and April 15.
Prior to open enrollment, there were an estimated 99,000 West Virginians eligible for private Obamacare plans, so the combined total of on and off-exchange enrollments represents nearly a third of those individuals. Perry Bryant, Executive Director of West Virginians for Affordable Health Care, called the first year’s enrollment numbers “not as robust as we would have liked” but noted that HealthCare.gov is much more functional that it was a year ago.
Why has West Virginia been so successful?
West Virginia is expanding Medicaid, and is using auto-enrollment directly through the state’s Medicaid program, in addition to Medicaid enrollment through the exchange. The state has been working to contact residents who receive SNAP and WIC benefits, as well as households where some members were already receiving Medicaid benefits. By letting these individuals know about the expanded Medicaid program, the outreach program has been wildly successful.
Actuaries had predicted that 63,000 people would enroll in WV’s expanded Medicaid program in 2014, but by September 2014, the number of new Medicaid enrollments in WV had grown to between 132,00 and 145,000 people, out of an estimated total of between 143,000 and 150,000 eligible people.
West Virginians for Affordable Health Care is a group that has been instrumental in pressing for healthcare reform in West Virginia for nearly a decade. They have been involved in education and outreach about the ACA, and are pushing for better management of chronic illnesses, which account for three quarters of the state’s health care spending. Their efforts have helped to bolster WV’s exchange enrollment numbers, for both Medicaid and private plans.
In December 2014, West Virginia University’s School of Public Health received a $2 million grant that will be used to pilot innovative approaches to improving public health and controlling healthcare costs. The initiative was sponsored by CMS, and initially focused on people using Medicare, Medicaid, and Children’s Health Insurance Program (CHIP). But WVU and its public health partners envision that eventually “… all West Virginians will benefit from these initiatives…”
West Virginia exchange history
After first 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. Earl Ray Tomblin’s administration cited cost, particularly the expense associated with information technology systems, as a key factor in deciding against a 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 the companies that sell health insurance policies on the exchange.
The state also oversees the In-Person Assister (IPA) program. Assisters will be 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.
No extension of grandmothered plans
West Virginia is not allowing 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. The state has also filed a lawsuit against the Obama Administration because the federal government deferred to the states on the decision about whether or not to renew grandmothered plans.
Contact the exchange
West Virginia residents will enroll through the federally facilitated exchange; 2016 enrollment runs November 1, 2015 through January 31, 2016.
West Virginia health insurance exchange links
State Exchange Profile: West Virginia
The Henry J. Kaiser Family Foundation overview of West Virginia’s progress toward creating a state health insurance exchange.