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

Premiums are the highest in the nation, despite decreasing slightly for 2019. For 2020, average rate increase will be less than 2%. Reinsurance legislation died in the Senate in 2019.

Highlights and updates

Wyoming exchange overview

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

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

Wyoming uses the federally run exchange, so residents enroll through Healthcare.gov. Blue Cross Blue Shield of Wyoming the only insurer offering plans in Wyoming’s individual market (both on- and off-exchange), and that will continue to be the case in 2020.

All of the plans available for sale in the exchange are PPOs, which is unusual; insurers in many states have switched to EPOs and HMOs, and some states have no PPOs for sale at all. BCBSWY will continue to offer only PPOs in 2020.

Enrollment in the Wyoming exchange reached a record high in 2019, with nearly 25,000 people enrolled. Across all states that use HealthCare.gov, average year-over-year enrollment has declined since peaking in 2016. But Wyoming has not experienced that dropoff in enrollment.

Wyoming premiums are higher than most of the rest of the country, but the ACA’s income-based premium subsidies keep coverage affordable for most enrollees. And because the cost of cost-sharing reductions was added to silver plan premiums for 2018, some enrollees who receive premium subsidies found that they could get bronze plans for very low – in some cases, zero – after-subsidy premiums.

According to an HHS report released in December 2016, there were roughly 20,000 more people with health insurance in Wyoming than there would be without the ACA.

Wyoming does not have an effective rate review process, which means the federal government (CCIIO) is in charge of reviewing rates in Wyoming. That system does not give federal regulators the ability to deny rate requests; rather, they’re only able to say whether or not the rate request is actuarially justified.

Unfortunately for Wyoming residents living below the poverty line, the high cost of unsubsidized coverage means that the coverage gap is particularly harsh in Wyoming. Since the state has not accepted federal funding to expand Medicaid, residents with incomes below 100% of poverty are not eligible for subsidies, and Medicaid is not available for most of them either. Their only alternative is to pay full price for private insurance, which is particularly unrealistic in a state where the average full-price premium is the highest in the country, at $960/month. While 70 percent of Wyoming residents disapprove of the ACA in general, 55 percent support Medicaid expansion according to a recent poll conducted by the University of Wyoming.

Special enrollment period for Blackjewel workers includes a rarely-granted retroactive effective date option

Nearly 600 Wyoming coal miners lost their health insurance at the end of August when Blackjewel/Revelation Energy terminated its health plan — a move that came several weeks after employees had stopped receiving paychecks. Because the health plan was terminated altogether, there was no option for workers to continue their coverage with COBRA.

These employees qualified for a loss-of-coverage special enrollment period in the individual market, which allows for applications as late as the last day the old coverage is in effect, with new coverage effective the first of the following month. But widespread confusion about the Blackjewel situation may have resulted in many of the affected workers not enrolling by the end of August and thus not having coverage as of September 1.

Retroactive coverage in the individual market is extremely rare, and generally only granted in relation to the birth or adoption of a child. But Wyoming’s Department of Insurance convinced the federal government to allow Blackjewel employees to have the option for retroactive coverage as long as they apply by the end of their special enrollment period, which continues until October 30 (that’s 60 days after their loss of coverage). The details are explained in this consumer alert from the Wyoming Department of Insurance.

Blackjewel workers who lost their coverage at the end of August have two options:

  • They can contact HealthCare.gov directly and enroll in a plan without retroactive coverage (normal effective date rules will apply: if they enroll by October 15, they’ll have coverage November 1, and if they enroll in the second half of October, they’ll have coverage effective December 1).
  • Or they can contact the Wyoming Department of Insurance (307-777-7401 or 800-438-5768), identify themselves as former Blackjewel employees, and request assistance with obtaining marketplace insurance with a September 1 effective date. People who choose this option will have to pay the September premiums for their new plan, but they’ll have coverage without a gap, which is essential for workers or family members who were dealing with health conditions when their previous coverage ended on August 31. In order to obtain retroactive coverage, it’s essential to start by contacting the Wyoming Department of Insurance — HealthCare.gov will not be able to provide a retroactive coverage date for people who contact them directly.

2020 rate increase less than 2%

For 2020 coverage, Blue Cross Blue Shield of Wyoming filed an overall average rate increase of 1.6 percent for their ACA-compliant individual market plans. As described below, average pre-subsidy premiums in Wyoming’s exchange were the highest in the country in 2019, despite a slight rate increase compared with 2018 rates.

For 2020, average premiums nationwide are mostly flat, so Wyoming’s average rates will continue to be very similar to what they were in 2018, but they will also continue to be among the highest in the country (it appears that West Virginia has moved into the most-expensive-premiums spot, bumping Wyoming down to number two).

Premium subsidies are particularly large for people who qualify for them in Wyoming, but coverage can be unaffordable for people who have to pay full price (for those whose income is just a little above the subsidy-eligibility cutoff, it’s useful to understand how pre-tax contributions to retirement accounts and/or a health savings account might bring total household income into the subsidy-eligible range).

Wyoming defers to the federal government for the rate review process, so BCBSWY’s rate filings were reviewed by federal regulators rather than the state insurance department.

Enrollment in Wyoming’s exchange

24,852 people enrolled in Wyoming’s exchange during the enrollment window for 2019 plans. That was a record high for Wyoming, where the previous record enrollment had occurred in 2017, when 24,826 people bought plans.

Here’s a look at how many people enrolled in private plans through Wyoming’s exchange during open enrollment for each year since coverage became available in 2014:

  • 11,970 people enrolled for 2014. This was the fourth lowest in the country, but Wyoming has the smallest population in the US.
  • 21,092 people enrolled for 2015.
  • 23,770 people enrolled for 2016. All former WINhealth enrollees had to switch to Blue Cross Blue Shield of Wyoming for 2016, as Winhealth stopped offering coverage at the end of 2015. Enrollment grew from 2015 to 2016 in all but one county in Wyoming. Only Fremont county (Lander is the county seat) experienced an enrollment decline, with a 267-person drop in enrollment. Wyoming consumer advocates believed that was likely due to the federal government ruling that the Northern Arapahoe Tribe is a large employer and is thus required to offer health insurance to its full-time employees. As a result, some of the tribe’s employees may have switched from exchange plans to group coverage offered by the tribe.
  • 24,826 people enrolled in coverage through the Wyoming exchange. This was a 4 percent increase over 2016’s enrollment. In the majority of the states that use HealthCare.gov, enrollment peaked in 2016 and declined a little more each year. But in Wyoming, enrollment grew again for 2017, just as it had in each of the previous years.
  • In 2018, Wyoming’s exchange experienced its first drop in enrollment, with 24,529 people signed up for coverage — about 1 percent lower than enrollment had been in 2017. Across all states that use HealthCare.gov, average enrollment was about 5 percent lower in 2018, so Wyoming’s enrollment decline was much less significant than other states experienced. And it came on the heels of an enrollment increase in 2017.
  • Enrollment climbed again for 2019, to a new record high for Wyoming. That came despite the elimination of the the ACA’s mandate penalty at the end of 2018 and the Trump Administration’s decision to reduce funding for HealthCare.gov’s marketing and enrollment assistance, and to expand access to non-ACA-compliant plans.

Wyoming has had just one exchange insurer since 2016

BCBSWY is the only insurer in the Wyoming exchange in 2019. That has been the case since 2016, after WINhealth stopped offering coverage at the end of 2015.

WINhealth announced in late 2015 that they would exit the individual market at the end of that year (at that point, they were still planning to continue to offer group plans. The decision to exit the individual market was triggered by the shortfall in risk corridors payments. WINhealth found out on October 1, 2015 that they would not receive $4.4 million they were due under the risk corridors program (nationwide, insurers were shorted about $2.5 billion in risk corridors payments).

But Wyoming Insurance Commissioner Tom Glause noted that WINhealth’s decision “did not come as a surprise to the Department [of Insurance],” as they were already aware of the financial challenges WINhealth had been facing prior to the risk corridors shortfall.

And on October 21, the other shoe dropped when WINhealth was placed in receivership by the Wyoming Department of Insurance. They ceased sales of new plans at that point, and in January 2016, a Laramie County District judge signed an order to liquidate the company.

The Wyoming Department of Insurance has had discussions with several out-of-state carriers about the possibility of them entering the Wyoming market at some point. In the spring of 2016, Melody Health Insurance Canopy Health Insurance had announced its plan to offer health insurance in the Wyoming and Nevada exchanges – limited to the Cheyenne and Las Vegas metro areas – for 2017. But the Wyoming Insurance Department confirmed in August 2016 that Canopy had been unable to get licensed in Nevada, which was the first step towards getting their Wyoming license.

As a result, they were not able to get licensed in Wyoming, and have never offered coverage in the Wyoming exchange. Blue Cross Blue Shield of Wyoming has been the only insurer offering plans in the Wyoming exchange since 2016. All of the plans that BCBSWY offers are PPOs, which is unusual at this point; residents in many states have no PPO options available at all, as insurers have increasingly opted to offer HMOs and EPOs instead, in an effort to contain costs.

Average rates were the highest in the country in 2019, despite a slight average rate decrease. But it appears they’ve dropped to second-highest for 2020

Average premiums in Wyoming’s exchange decreased slightly for 2019, in sharp contrast with the 48 percent average rate increase that applied the year before, for 2018 coverage. For on-exchange plans, the average premiums for BCBSWY plans is 0.27 percent lower in 2019. And for off-exchange plans, the average decrease was 0.12 percent.

The cost of cost-sharing reductions (CSR) is once again being added to silver plan rates for 2019 in Wyoming, and BCBSWY’s rate filing again indicated that “the premium rates for silver plans sold through the FFM would have been significantly lower if CSR funding were appropriated by the federal government.”

But because the cost of CSR was already added to silver plan rates in Wyoming for 2018, that was the baseline from which rate changes for 2019 applied. So although the cost of CSR continues to be added to premiums in 2019, average rates still decreased slightly from 2018 to 2019. And because the cost of CSR is still concentrated on silver plan rates, people who get premium subsidies and buy bronze or gold plans will continue to find that those plans are more affordable than they were in past years.

Average pre-subsidy premiums in the Wyoming exchange were the second-highest in the country in 2018, at an average of $973/month, according to CMS data. Only Iowa, with an average of $988/month, had higher average pre-subsidy rates. But for 2019, Wyoming has the highest average pre-subsidy premiums (at $960/month), even though they’ve dropped since 2018 (Iowa’s dropped to $918/month; West Virginia took over the second-highest spot, at $937/month). For 2020, however, West Virginia appears to have the highest pre-subsidy premiums, which are slightly higher than Wyoming’s.

A few years ago, Alaska had the most expensive premiums, at least in terms of the cost of the second-lowest-cost silver plan in each area. But Alaska has since implemented a reinsurance program that resulted in rate decreases in 2018 and again in 2019, on the heels of a very modest increase in 2017. As a result, the average pre-subsidy premium in Alaska’s exchange is $746/month in 2019 (still higher than most states, but quite a bit lower than Wyoming’s average premiums).

Because premium subsidies are designed to ensure that people with the same income pay the same price for the benchmark plan — regardless of where they live or how old they are — premium subsidies are particularly large in Wyoming. In 2019, the average after-subsidy premium in Wyoming’s exchange is just $125/month, which is lower than the $191/month average across the country. And although Wyoming’s pre-subsidy rates are particularly high – making coverage unaffordable for many people who don’t get premium subsidies – the situation for people who do qualify for premium subsidies in Wyoming is significantly better than it was in 2017, as described below.

Here’s a look at how premiums have changed in Wyoming’s exchange since plans became available in 2014:

  • In 2015, when plans were still available from both BCBSWY and WINhealth, a Commonwealth Fund analysis found that rates in Wyoming’s exchange were an average of 5 percent higher in 2015 (compared with 2014) for a 40 year-old non-smoker. The NY Times Upshot pegged the increase in benchmark plan premiums in Wyoming at 7 percent or more, although the Kaiser Family Foundation showed the average benchmark plan rate in Wyoming increasing by just 1.6 percent for 2015.
  • In 2016, BCBSWY increased their average rates by about 6 percent. WINhealth had proposed a rate increase of 13.37 percent, but they shut down at the end of 2015. Time insurance also offered plans outside the exchange in Wyoming in 2015, but they announced in June 2015 that they would exit the individual market nationwide, and would not participate in the 2016 open enrollment period.
  • In 2017, the average rate increase for Blue Cross Blue Shield of Wyoming’s individual market plans was very modest, especially compared with the national average for 2017, which was about 25 percent. BCBSWY’s average rate increase for exchange plans was 8.18 percent for BlueSelect plans without pediatric dental and 7.85 percent for BlueSelect plans with pediatric dental.
  • 2018 was the first year that insurers had to account for the fact that the federal government was no longer reimbursing them for the cost of cost sharing reductions (CSR, sometimes called cost-sharing subsidies). BCBSWY added the cost of CSR to silver on-exchange plans, and created slightly different off-exchange silver plans that didn’t include the cost of CSR in their premiums.So Blue Cross Blue Shield of Wyoming had separate average rate increases for their off-exchange and on-exchange plans in 2018. Off-exchange, the average rate increase was 39 percent, with a range of 27.5 percent to 45.7 percent. But on-exchange, the average premium increase for 2018 was 48.2 percent, with a range of 25.9 percent to 83.6 percent. BCBSWY’s rate filing noted that “the premium rates for silver plans sold through the FFM would have been significantly lower if CSR funding were appropriated by the Federal government.”

Wyoming House passed a reinsurance bill in 2019, but Senate killed it

Following in the footsteps of several other states — including Alaska, which shares many insurance dynamics with Wyoming — the Wyoming Department of Insurance worked in 2018 on a 1332 waiver proposal to seek federal funding for a reinsurance program. The proposal needed state legislative support before it could be submitted to the federal government, and although the Wyoming House passed a reinsurance bill (HB 85) with nearly unanimous support in early 2019, the measure died in the Senate.

Lawmakers in the Senate were concerned about the 1 percent assessment that the measure would have imposed on health and disability insurers in the state. That assessment was expected to raise about $9 million per year in state funding, but that would have been dwarfed by the federal “pass-through” funding that the state would have received under the terms of the 1332 waiver they would have proposed if the legislation had been enacted.

Reinsurance works by covering a portion of high-cost claims (the details vary across the states that have set up reinsurance programs, but they generally either reimburse insurers if they have patients with certain high-cost conditions, or reimburse a portion of claims that exceed a certain dollar amount; Wyoming’s legislation would have left the details up to the state insurance commissioner).

That results in lower premiums, because the insurers know that some of their risk is being absorbed by the reinsurance program. When premiums are lower, premium subsidies (funded by the federal government) are also lower, since they don’t have to offset such high premiums (for example, if the after-subsidy price needs to be $100, the subsidy amount will be lower if the pre-subsidy amount is $500, versus if it’s $350). In 2019, 92 percent of Wyoming exchange enrollees are receiving premium subsidies, so the federal savings would be considerable if subsidies were to be smaller.

By using a 1332 waiver, the state gets to keep the federal savings, rather than having the federal government keep the money. The state would then use the money to fund the reinsurance program, in addition to the $9 million that the state would have raised via the assessment on insurers. In Wyoming, the estimate was that the federal pass-through funding would have amounted to $60 million per year, so federal funds would have covered nearly 87 percent of the cost of the reinsurance program.

If the state had enacted HB 85 and moved forward with a 1332 waiver for reinsurance, it would have benefitted roughly 3,500 people who pay full price for individual market, ACA-compliant plans in Wyoming (both on-exchange and off-exchange). These individuals don’t qualify for premium subsidies. In most cases, that’s because their incomes exceed 400 percent of the poverty level, but they could also be affected by the family glitch, or purchasing coverage outside the exchange for some reason, where subsidies aren’t available.

For people who do qualify for premium subsidies, a reinsurance program would make little difference in their net premiums — their subsidies would have ended up being smaller, but that’s because the full-price cost of their plans would have been smaller as well. But for those who don’t qualify for any subsidies and are thus responsible for paying 100 percent of their premiums, the projection was that a reinsurance program would have lowered their premiums by about 17 percent.

But since HB 85 didn’t pass in the Senate, reinsurance is no longer under consideration in Wyoming in 2019.

Despite health insurance premiums that are nearly the highest in the nation, FREE coverage is available to some Wyoming enrollees

Wyoming’s individual health insurance market experienced substantial rate increases in 2017 and 2018, although the rates have stabilized since then. Since 2018, the cost of cost-sharing reductions (CSR) has been added to silver plan rates. And since premium subsidies are based on the cost of the benchmark silver plan, the premium subsidies grew substantially in 2018 and have remained disproportionately large. So although average rates decreased slightly in 2019 and are increasing only slightly for 2020, average premium subsidies are still much larger than they were in 2017.

The subsidies keep the cost of the benchmark plan fairly consistent from one year to the next. But the subsidies can also be applied to plans at other metal levels, which have had less premium growth since 2017. That makes those plans particularly affordable for people who qualify for premium subsidies but who don’t get CSR benefits and thus don’t need to select a silver plan (CSR benefits are only available if you buy a silver plan).

As an example, consider a family in Sweetwater County: parents are 45, kids are 15 and 13, and their household income is $97,000 (we’ll assume their ages stay the same from year to year, for easier comparison; in reality, each person’s rate goes up every year even if there aren’t any rate hikes at all, because we’re all getting older. We’ll also assume that their income stays the same, although annual increases in the poverty level will mean that an unchanging income gradually becomes a smaller and smaller percentage of the poverty level over time).

In 2017, the cheapest plan this family could get, after their premium subsidies were applied, was a bronze plan that cost $526/month. Their subsidy amount in 2017 would have been $873 per month. So although it would have paid nearly two-thirds of their premiums, they still would have been left paying $526 each month in premiums, for the lowest-cost plan available to them.

For 2018, 2019, and 2020, however, they could choose from three bronze plans with $0 premiums. They would still have out-of-pocket costs if they needed medical care, of course. But their premiums would be entirely free for any of those three plans. Their premium subsidy in 2018 was a whopping $2,295 per month, which more than covers the cost of the three lowest-cost bronze plans. For 2019, their premium subsidy was $2,268 (slightly lower, because premiums decreased slightly in 2019). And for 2020, their subsidy is $2,335 per month.

The availability of zero-premium plans for middle-class families since 2018 is a result of the cost of CSR being added to silver plan premiums in Wyoming, making premium subsidies much larger relative to the cost of a bronze plan.

And the oddly-priced plans in Wyoming even extend to the gold level. Not counting the three free bronze plans, the three cheapest options available to this family are all gold plans, which are priced below the available silver plan options.

A 45-year-old in Sweetwater County who earns $25,000 can get a premium subsidy of $871/month in 2020. This results in three bronze plans that would be entirely free, as well as two gold plan option that would also be free in terms of monthly premiums (they have deductibles of $750 and $2,000, and total out-of-pocket caps of $7,900). In addition, this person would be able to select a different gold plan that would cost less than $3/month after the subsidy is applied. In contrast, the lowest-cost silver plan available would be $128/month, for a plan with a $4,000 deductible and a $6,300 cap on out-of-pocket costs.

Strategies for getting income into the subsidy-eligible range

What if the family of four in Sweetwater County earns $117,000 instead of $97,000? Now their situation is much different, as premium subsidies end altogether at 400 percent of the poverty level ($103,000 for a family of four in 2020, based on 2019 poverty level numbers), which would seem to leave them with no option other than paying a minimum of $2,092/month in premiums, as that’s the lowest-cost plan available to them (one of the bronze plans that would have been entirely free if they earned $97,000/year instead).

But it’s important to keep in mind how modified adjusted gross income (MAGI) is calculated for determining eligibility for ACA premium tax credits (aka, premium subsidies). Contributions to pre-tax retirement accounts, as well as contributions to an HSA (if you have HSA-qualified health insurance), will reduce your MAGI.

If each parent contributes $6,000 to a traditional IRA in 2020 (keeping in mind that eligibility for premium tax credits is based on projected income for the coming year, so this would be anticipated contributions that haven’t happened yet; $6,000 is the maximum allowable contribution to an IRA in 2020), it would reduce their MAGI from $117,000 to $105,000 — still too high to qualify for premium subsidies (this assumes that the parents are not eligible to contribute to employer-sponsored retirement plans, which would allow for additional contributions if the parents had them as an option).

But if the family were to also enroll in the BlueSelect Bronze Core plan (the lowest-cost bronze plan, and the only one in their area that is HSA-qualified), they could contribute $7,100 to an HSA in 2020. That would further reduce their MAGI, down to $97,900. At that point, they are eligible for premium subsidies. And instead of paying $2,092/month for the BlueSelect Bronze Core plan (the unsubsidized price), they would be eligible for premium subsidies worth $2,328 per month, which would cover the entire premium, leaving them with $0 in premium costs per month (note that the specific premiums vary based on age and zip code, so people in other areas of Wyoming, and enrollees of other ages, will face differing premium amounts and premium subsidy amounts).

In this case, the family could have skipped the IRA and HSA contributions, and purchased the cheapest bronze plan with no help from premium subsidies, spending $25,104 in premiums for the year. Instead, they can put $12,000 into their combined IRAs and $7,100 into an HSA — rather than giving it to an insurance company — and spend $0 on premiums. If you’re facing the subsidy cliff, consult a tax advisor before you give up on being able to afford health insurance [Note that I am not a tax advisor. This section is simply a rough illustration of how MAGI is calculated for premium subsidy eligibility, and a reminder that pre-tax contributions can have a big effect on the outcome. When planning your own finances, you need to speak with a tax expert.]

No DOI oversight for Direct Primary Care Practices

In early 2016, Governor Mead signed SF49 into law, exempting direct primary care programs from Wyoming Department of Insurance regulations and oversight. That makes it easier for doctors to establish direct primary care practices, charging members a set monthly fee in return for whatever primary care the patient might need.

Particularly in states like Wyoming, where unsubsidized health insurance is much more expensive than average, and where the “subsidy cliff” is much more of an issue than it would be in places with lower premiums, direct primary care models can be an attractive alternative to higher-priced major medical health insurance. And like healthcare sharing ministries, direct primary care practices pose a potential threat to the stability and health of the regular insurance risk pool, since sicker applicants are more likely to gravitate to higher-priced – but much more comprehensive – ACA-compliant health insurance.

With that said, it’s important to note that direct primary care memberships only cover primary care. If a member needs care that involves hospitalization or treatment that cannot be provided in a primary care setting, the primary care membership will not provide any value.

Wyoming exchange history

Then-Gov. Matt Mead announced in late 2012 that Wyoming would default to the federal health insurance exchange for 2014, with the possibility of moving to a state-run exchange at some unspecified future date.

In 2012, the Wyoming legislature passed a bill requiring a small committee to study the federal government’s implementation and operation of the exchange. The committee was to monitor how many state residents use the federal exchange, what problems they encounter, operating costs, and other factors in deciding whether to recommend the state eventually take over operations of the exchange. The committee held its first meeting in April 2013, but Wyoming has never seriously considered the possibility of running its own exchange.

Gov. Mead initially refused to expand Medicaid, but began supporting expansion as time went on. In November 2014, Gov. Mead and the Health Department presented lawmakers with a modified Medicaid expansion proposal, and the governor asked them to approve it. Although a Senate committee approved a modified version of Mead’s proposal, the full Senate rejected it in early February. Medicaid still has not been expanded in Wyoming as of 2019.

Wyoming health insurance exchange links

HealthCare.gov
800-318-2596

Wyoming Insurance Department
Provides consumer protection and support to Wyoming residents by investigating consumer complaints and resolving issues on insurance matters.
(307) 777-7401 / Toll Free: 1-800-438-5768 / wyinsdep@state.wy.us

State Exchange Profile: Wyoming
The Henry J. Kaiser Family Foundation overview of Wyoming’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.