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

Premiums decreasing slightly in 2018, and lawmakers are expected to consider a reinsurance bill in the 2019 session

Highlights and updates

Wyoming exchange overview

Wyoming uses the federally-run exchange, so residents enroll through Healthcare.gov. There is only one insurer in the Wyoming exchange for 2018, as was the case in 2017 and 2016. The Wyoming Insurance Department has confirmed that Blue Cross Blue Shield of Wyoming will once again be the only insurer in the exchange in 2019. Wyoming relies on the federal government for rate review, so rate filing information doesn’t become available until it’s posted on ratereview.healthcare.gov in August.

Enrollment in the Wyoming exchange grew for 2017, and only dropped about 1 percent in 2018. Across all states that use Healthcare.gov, there was an average decrease in enrollment in both 2017 and 2018, but Wyoming didn’t experience 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 continues to have just one exchange carrier in 2019, but average rates are decreasing slightly

The Wyoming Insurance Department confirmed in June 2017 that Blue Cross Blue Shield of Wyoming would continue to be the only insurer offering plans in the Wyoming exchange in 2018. Freedom Life also filed ACA-compliant plans for 2018, but only off-exchange (Freedom Life doesn’t typically market their ACA-compliant plans in any states, as their focus is excepted benefits that aren’t compliant with the ACA).

BCBSWY will again continue to be the only insurer in the exchange in 2019, according to the Wyoming Insurance Department. But average rates are decreasing slightly for 2019, in sharp contrast with the 48 percent average rate increase that applied in Wyoming in 2018. For on-exchange plans, the average premiums for BCBSWY plans will be 0.27 percent lower in 2019. And for off-exchange plans, the average decrease will be 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’s the baseline from which rate changes for 2019 apply. So although the cost of CSR will continue to be added to premiums in 2019, average rates are still decreasing slightly from 2018 to 2019. And because the cost of CSR will still be 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.

Wyoming was the only state in the US that had just one exchange carrier in 2016, although West Virginia was in that situation in 2014 and 2015, and Alaska nearly ended up with just a single carrier in 2016.

For 2017, Alaska and Wyoming both had just one exchange carrier, as was the case in Oklahoma, Alabama, and South Carolina. Numerous states across the country had partial areas of the state with just a single carrier offering plans in the exchange in 2017. And for 2018,  Delaware, IowaMississippi, and Nebraska also have just one insurer offering coverage in the exchange, although Alabama now has two insurers offering coverage. And for 2019, Oklahoma and Iowa both have a second insurer joining their exchanges.

In the spring of 2016, Melody Health Insurance Canopy Health Insurance had announced their 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 did not offer coverage in the Wyoming exchange in 2017. Blue Cross Blue Shield of Wyoming was the only carrier participating in the exchange in Wyoming in 2017, and that continues to be the case as we head into the open enrollment period for 2019 coverage. Canopy purchased Colorado Choice in neighboring Colorado, and is selling plans in Colorado’s exchange under the name Friday Health Plans for 2018. But the Wyoming Department of Insurance confirmed that Canopy did not pursue an entry to Wyoming’s market for 2018.

Wyoming is considering a reinsurance program

Following in the footsteps of several other states — including Alaska, which shares many insurance dynamics with Wyoming — the Wyoming Department of Insurance is working on a 1332 waiver proposal to seek federal funding for a reinsurance program. The proposal would need legislative approval before it could be submitted to the federal government for approval, and Wyoming’s legislature won’t meet again until early 2019.

But assuming lawmakers pass a bill to create a reinsurance program, the state would be able to seek federal “pass-through” funding to offset some of the cost of the program. The idea is that the reinsurance program covers 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). 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 2018, 95 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 then uses the money to fund the reinsurance program, in addition to whatever state funding is necessary to fully cover the cost. The specifics in terms of the cost of the program and the impact on premiums depend on how the program is designed (ie, how high claims have to be before they’re covered by reinsurance, what percentage of the claims are covered, how long the reinsurance program continues to cover claims, ect.), but the state expects to have preliminary data available by November 2018.

During the 2019 session, if lawmakers approve a reinsurance bill and state funding for the program, Wyoming will be able to move forward with the waiver proposal process, seeking federal pass-through funding to cover the bulk of the cost of a reinsurance program. If approved and implemented, it would likely result in a more stable market in the state, with potential premium decreases in 2020. Lawmakers in Wyoming have indicated that they’re cautious about the proposal, but willing to consider it.

Year-over-year enrollment down just 1% from 2017, despite much shorter enrollment period and reduced exchange funding

Open enrollment for 2018 coverage began on November 1, 2017, and ended on December 15, 2017. During open enrollment, 24,529 people signed up for coverage in the Wyoming exchange. In 2017, enrollment reached 24,826, so it was about 1 percent lower in 2018. 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.

The lower enrollment in 2018 was due to a variety of factors, including a shorter open enrollment period, reduced federal funding for enrollment assistance and exchange marketing, higher premiums for people who don’t qualify for premium subsidies, and general uncertainty about the status of the ACA, particularly the individual mandate (the mandate penalty was repealed in the GOP tax bill that was enacted after open enrollment ended, but that repeal won’t take effect until 2019)

As of February 2018, effectuated enrollment in Wyoming’s exchange stood at 23,089. Of those enrollees, 95 percent were receiving premium subsidies to offset some or all of their monthly premiums.

2018: 48% average rate increase for on-exchange plans, but much of that was for silver plans, due to elimination of CSR funding

Average pre-subsidy premiums in the Wyoming exchange are 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, has higher average pre-subsidy rates. 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 a significant rate decrease for 2018, on the heels of a very modest increase in 2017. 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 actually quite good in 2018, and significantly better than it was in 2017, as described below.

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 [cost-sharing reduction] funding were appropriated by the Federal government.”

Cost sharing reductions (CSR, sometimes called cost-sharing subsidies) reduce out-of-pocket costs for lower-income exchange enrollees who select silver plans. For 2018, an individual can get CSR benefits with an income between $12,060 and $30,150, although the CSR benefits are fairly weak at incomes above $24,120 (for family coverage, see this chart for income limits; CSR benefits extend to 250 percent of the federal poverty level, but are strongest below 200 percent of the poverty level).

CSR benefits are still available to eligible enrollees. But the federal government is no longer reimbursing insurers for the cost of providing those benefits, per the Trump Administration’s decision in October 2017 to eliminate that funding immediately. Insurers in most states — including Wyoming — had already prepared for that eventuality (Trump had been threatening to cut off the funding throughout 2017) by adding the cost of CSR to premiums for 2018.

The best approach that insurers could take was to add the cost of CSR to on-exchange silver plan premiums only (with no other metal levels affected), and create slightly different off-exchange plans where the silver level did not include the cost of CSR baked into the premiums. That is what BCBSWY did, so Wyoming residents are well protected in 2018 from the federal government’s decision to cut off CSR funding.

People who get premium subsidies are protected from the rate increase because the subsidies are so much larger in 2018 to account for the higher cost of silver plans (and people who get premium subsidies and choose non-silver plans are even better off than they were in 2017 — see example below). People who don’t get premium subsidies could either select a non-silver plan (on or off-exchange), or an off-exchange silver plan, since those plans do not have the cost of CSR added to the premiums.

Despite rate increase, some people can get free coverage for 2018

Although the average rate increase for on-exchange Blue Cross Blue Shield of Wyoming plans was 48 percent for 2018, it varied considerably from one metal level to another. The cost of cost-sharing reductions (CSR) was added to silver plans for 2018, so the rate hikes for other metal levels weren’t as large. And since premium subsidies are based on the cost of the benchmark silver plan, the premium subsidies are much larger for 2018 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 smaller rate hikes for 2018. 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). 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, however, they could choose from three bronze plans that all have $0 premiums. They would still have out-of-pocket costs if they need medical care, of course. But their premiums would be entirely free for any of those three plans. Their premium subsidy in 2018 is a whopping $2,295 per month, which more than covers the cost of the three lowest-cost bronze plans. This is because the cost of CSR has been added to silver plans in Wyoming for 2018, 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. A 45-year-old in Sweetwater County who earns $25,000 can get a premium subsidy of $850/month. This results in three bronze plans that would be entirely free, as well as a gold plan option that would also be free in terms of monthly premiums (it has a $2,000 deductible and $7,350 in total out-of-pocket costs). In addition, this person would be able to choose from two other gold plans that cost $2.87/month and $9.38/month, respectively. In contrast, the lowest-cost silver plan available would be $136/month.

This is all a good reminder to shop carefully during open enrollment. Don’t rely on auto-renewal, or assume that the plan you had in 2017 is the best option for 2018. Open enrollment ends on December 15, though, so there is much less time than there was in prior years to select a plan for the coming year.

Strategies for getting income into the subsidy-eligible range

What if the family of four in Sweetwater County earns $115,000 instead of $97,000? Now their situation is much different, as premium subsidies end altogether at 400 percent of the poverty level ($98,400 for a family of four in 2018), which would seem to leave them with no option other than paying a minimum of $2,183/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 $75,000/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 $5,500 to a traditional IRA in 2018 (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; $5,500 is the maximum allowable contribution to an IRA in 2018), it would reduce their MAGI from $115,000 to $104,000 — 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 second-lowest-cost bronze plan, and the only one in their area that is HSA-qualified), they could contribute $6,850 to an HSA in 2018. That would further reduce their MAGI, down to $97,150. At that point, they are eligible for premium subsidies. And instead of paying $2,057/month for the BlueSelect Bronze Core plan (the unsubsidized price), they would be eligible for premium subsidies worth $2,294 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 (not HSA-qualified) with no help from premium subsidies, spending $26,196 in premiums for the year. Instead, they can put $11,000 into their combined IRAs and $6,900 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 adviser before you give up on being able to afford health insurance [Note that I am not a tax adviser. This section is simply a rough illustration of how MAGI is calculated for premium subsidy eligibility, and 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.]

2017 enrollment

During the 2017 open enrollment period, 24,826 people enrolled in coverage through the Wyoming exchange — a 4 percent increase over the 23,770 people who enrolled in 2016.

The average pre-subsidy premium in Wyoming’s exchange for 2017 is $614/month, considerably higher than the $476/month average across all the states that use the federally-run exchange. But the ACA’s premium subsidies are larger in states with higher premiums, so Wyoming’s average after-subsidy premium is just $164/month — very similar to the $153/month average across all states using the federally-run exchange.

Average 2017 rate hike much smaller than national average

Wyoming has among the highest premiums in the nation; in 2017, only Alaska, North Carolina, Oklahoma, and West Virginia have higher average pre-subsidy premiums than Wyoming.

Despite the high premiums, Blue Cross Blue Shield of Wyoming had a 102.1 percent medical loss ratio in 2016, which is not sustainable long-term. Medical loss ratio refers to the percentage of premiums that are spent on medical costs (as opposed to administration and profit), and a number above 100 means that the insurer is spending more on claims than it’s collecting in premiums.

However, the average rate increase for Blue Cross Blue Shield of Wyoming’s individual market plans was very modest for 2017, especially compared with the national average for 2017 (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. All of the plans are PPOs, which is unusual in 2017 — many states have very limited selection in terms of PPO options, and some states have no PPOs available at all in the exchange.

Although a lack of competition in the exchanges obviously means that consumers have few total options from which to choose, the ACA’s medical loss ratio applies regardless of how many carriers participate: In the individual market, a health plan must spend at least 80 cents of every premium dollar on medical claims; there’s no mechanism for increasing rates just because there’s no competition (as noted above, BCBSWY had an unsustainably high medical loss ratio in 2016 — well above the minimum requirements of the ACA). It’s noteworthy, however, that the Senate health care reform bill (the Better Care Reconciliation Act) would sunset the ACA’s medical loss ratio after 2019. At that point, states would be able to decide what percentage of premiums insurers have to spend on medical claims. If a state opts to weaken the requirement, insurers would be able to use more of the premiums they collect for administrative costs.

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.

Because most Wyoming exchange enrollees (89 percent at the end of the 2017 open enrollment period) are receiving subsidies, the subsidies offset the bulk of the rate increases for most enrollees. Because of the way the subsidies interact with the federal poverty level, they keep premium increases in check from one year to the next for eligible enrollees. It’s important to shop around during open enrollment, as the benchmark plan can change from one year to the next. However, in a state with just one participating exchange carrier, the benefit of shopping around is obviously much less significant than it is in states with multiple carriers.

2016 effectuated enrollment > 22k

During the 2016 open enrollment period, 23,770 people enrolled in private plans through the Wyoming exchange, including new enrollees and renewals. For perspective, 18,065 people had in-force coverage through the Wyoming exchange as of June 2015, and total enrollment at the end of the 2015 open enrollment period stood at 21,092 people.

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 believe that is 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.

By March 31, 2016, effectuated enrollment through the Wyoming exchange stood at 22,076 people. 92 percent were receiving subsidies that averaged $459 per month.

All of the enrollments in the Wyoming exchange for 2016 are through Blue Cross Blue Shield of Wyoming, since WINhealth stopped offering coverage as of December 31, 2015 (details below), leaving BCBS of WY as the lone carrier. All former WINhealth members had to pick a new plan by the end of December; otherwise they were uninsured as of January 1. But they also qualified for a special enrollment period (through February 29, 2016) because loss of coverage is a qualifying event.

Increased penalty for being uninsured in 2016 and beyond

For people who don’t have insurance in 2016 and aren’t exempt from the ACA’s penalty, the penalty is significantly higher than it was in 2014 and 2015. The penalty for 2016 was the greater of $695 per uninsured adult (half that amount for a child) up to $2,085 per household, OR 2.5 percent of household income above the tax filing threshold. For tax filers who owed a penalty, the average penalty was expected to be almost $1,000 for 2016. That’s about five times what it was for 2014. Any applicable penalty for 2016 was collected when tax returns were filed in early 2017.

The flat rate penalty is indexed for inflation in years after 2016, but the IRS confirmed in late 2016 that there would be no adjustment for 2017. The flat-rate penalty remains $695 per uninsured adult in 2017.

Both the House and Senate health care reform bills (the AHCA and the BCRA) call for the retroactive elimination of the individual mandate penalty. Under both pieces of legislation, the individual mandate penalty would reset to $0 (as would the employer mandate penalty) as of January 2016. So if the legislation were to be enacted, the IRS would presumably have to refund penalties that were collected for 2016 and there would no longer be penalties collected for being uninsured in 2017. The Congressional Budget Office (CBO) estimates that if the Senate bill were to be implemented, 15 million fewer people would have health insurance in 2018, and they note that is “primarily because the penalty for not having
insurance would be eliminated.” The people who would drop coverage as a result of the penalty elimination are typically healthy. Removing them from the insurance pool will skew the overall mix further towards the less healthy end of the spectrum.

No DOI oversight for Direct Primary Care Practices

In early 2016, Governor Mead signed SF49 into law, exempting direct primary care programs from state 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 membership in a direct primary care practice does not constitute minimum essential coverage under the ACA. So if an individual is not exempt from the ACA’s individual mandate and relies solely on a direct primary care membership, the ACA’s penalty for being uninsured will be assessed when that person files a tax return. A direct primary care membership can be used in conjunction with a health insurance plan in order to fulfill the ACA’s individual mandate, but it cannot replace major medical health insurance.

It’s also important to note that direct primary care memberships only cover primary care. If a members 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.

WINhealth liquidated

On October 8, 2015, WINhealth – one of the two carriers that offered plans in Wyoming’s exchange in 2015 – announced that they would exit the individual market at the end of 2015. At that point, they were still planning to offer offer group plans, but 8,234 people with individual WINhealth plans were informed that they would need to find new coverage for 2016.

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 company’s assets will be used to pay claims that were incurred through December 31, 2015, and the Wyoming Life and Health Guaranty Association will serve as a back-up if there aren’t enough assets to cover claims.

The Wyoming Department of Insurance has been in discussions with several out-of-state carriers about the possibility of them entering the Wyoming market in 2017 or beyond. But for now, WINhealth’s exit leaves Blue Cross Blue Shield of Wyoming as the sole carrier offering individual and small group plans in the Wyoming exchange for 2016 (Altius(Aetna/Coventry) and UnitedHealthcare also offer small group plans outside the exchange; Celtic and Altius also offers individual plans outside the exchange in some areas).

2016 rates: BCBS of WY up about 6%

Wyoming’s pre-subsidy health insurance rates are much higher than the national average. Only Alaska and Vermont have higher pre-subsidy average benchmark rates in the exchange for 2016.

90 percent of the people who selected a plan through the Wyoming exchange for 2016 were eligible for premium subsidies to offset the cost of their coverage. For those enrollees, the average pre-subsidy premium is $571/month, which is far higher than the $396/month average across all 38 states that use Healthcare.gov. But after subsidies, the average premium in Wyoming is just $117/month – only slightly higher than the $106/month average for Healthcare.gov states.

Premium subsidies cover an average of 80 percent of the cost of coverage for eligible enrollees, and are an excellent example of how the ACA’s subsidies even out discrepancies in pricing from one state to another, for enrollees with income under 400 percent of the poverty level.

2016 rates were already set for BCBS of WY prior to WINhealth’s departure, and despite the lack of competition, the carrier is still bound by the ACA’s medical loss ratio rules requiring at least 80 percent of premiums to be spent on medical claims.

Prior to the release of BCBS of WY’s rate changes for 2016, CEO Rick Schum offered some reassurance to Wyoming exchange enrollees, saying “I would highly doubt any of our customers – or future customers – are in for any sticker shock.”

Wyoming is one of five states that leaves the rate review process entirely up to HHS for ACA-compliant products. It was already known that BCBS of WY had proposed rate hikes of less than 10 percent, as any proposed rate increases of 10 percent or more were made public on Healthcare.gov’s rate review tool in June. Ultimately, BCBS of WY ended up with average rate increases of about 6 percent. The average benchmark premium is 5.6 percent higher in 2016 than it was in 2015. Benchmark (second-lowest-cost Silver) plan premiums are used to determine subsidy amounts, so the average subsidy is higher in Wyoming in 2016 assuming average incomes remained the same.

WINhealth had proposed a rate increase of 13.37 percent, but their enrollees ended up having to switch to a different plan for 2016. In most cases, that was a plan from BCBS of WY (the carrier offers 28 different plan options in the exchange), although Celtic and Altius offer plans in limited areas outside the exchange in Wyoming (total enrollment in those plans was negligible as of 2015; the Department of Insurance said in September 2015 that BCBS and WINHealth accounted for virtually all of the individual market in Wyoming). Plans purchased outside the exchange are not eligible for subsidies though.

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.

ACA makes coverage affordable in Wyoming

Among people who enrolled in coverage through the Wyoming exchange during the 2016 open enrollment period, 90 percent are receiving premium tax credits (subsidies). Across all states that use Healthcare.gov, only Florida has a higher subsidy-eligibility rate, at 91 percent, and Mississippi is tied with Wyoming at 90 percent (both of those states have considerably lower pre-subsidy premium averages and average subsidy amounts than Wyoming. Across all Healthcare.gov states, an average of 85 percent of exchange enrollees are receiving subsidies.

Health insurance in Wyoming is much more expensive than the national average, which explains the high percentage of people who qualify for subsidies.  In addition, because coverage is so expensive in Wyoming, the average subsidies is considerably higher there than it is in other states: Among all Healthcare.gov states, the average subsidy is $290 per month; in Wyoming, it’s $454 per month (only Alaska has higher average subsidies in 2016).

Because of the way the ACA’s premium subsidies are structured, they are particularly helpful in regions where the “retail” cost of health insurance is higher than average. Wyoming is a great example. Although Wyoming has among the most expensive pre-subsidy health insurance premiums in the US, the after-subsidy premiums are just a few dollars per month higher than average. Subsidies make up most of the difference, for people whose income doesn’t exceed 400 percent of the poverty level.

Cadillac tax particularly concerning in Wyoming

Because health insurance is so much more expensive in Wyoming, the state was concerned about the impact of the ACA’s “Cadillac tax” that was set to go into effect in 2018. The idea behind the tax was to generate revenue by placing an excise tax on employer-sponsored health insurance with premiums that exceed a pre-determined annual cap (the tax is only assessed on the portion of the premium that exceeds the cap).

In 2018, that cap was to be $10,200 for a single individual, and $27,500 for a family plan. Nationally, it’s estimated that just ten percent of employer-sponsored plans would be subject to the tax in 2018, but there was concern that it will impact a far higher percentage of employer-sponsored plan in Wyoming, simply because it’s more costly to provide health insurance in the state.

But on December 18, 2015, federal lawmakers passed H.R.2029, a $1.8 trillion federal spending bill that includes a provision to delay the Cadillac tax for two years, pushing its implementation out to 2020.

And the Trump Administration, together with a Republican-led Congress, has been pushing to repeal numerous parts of the ACA. The AHCA, which has not yet advanced to a vote on the House floor, would delay the Cadillac tax until 2026.

Only a slight change in uninsured rate

Wyoming’s uninsured rate decreased slightly from 2013 to 2014, but the decrease from 2014 to 2015 was not statistically significant (only two other states — North Dakota and South Dakota) had similarly insignificant decreases).

According to U.S. Census data, the uninsured rate in Wyoming in 2013 was 13.4 percent. By 2015, it had dropped to 11.5 percent. The overall decrease was much less significant than the U.S. average.

Wyoming’s lack of progress on this front is largely blamed on the fact that Wyoming lawmakers have refused to accept federal funding to expand Medicaid under the ACA (that is still the case, although Governor Mead has been pushing for expansion). Wyoming also didn’t establish their own state-run exchange, but even among other states that followed the same path (no state-run exchange, and no Medicaid expansion), the average uninsured rate dropped more sharply from 2013 to mid-2015.

But nine states still had higher uninsured rates than Wyoming in 2015.

2015 enrollment data

The Wyoming exchange enrolled 21,092 people in private plans during the 2015 open enrollment period (through February 22, including the week-long extension).  This is about a third of the exchange’s total target population.

As of January 9, Wyoming had the highest percentage increase in the country when comparing 2015 enrollment numbers with enrollment totals as of April 2014.  On January 9, the 2015 enrollment count was 42 percent higher than the prior year’s total.  By January 30, the growth over last year had increased to 54 percent – with two more weeks remaining in open enrollment.  HHS had set an enrollment projection of just 15,000 people for Wyoming’s exchange by February 15, and the exchange easily surpassed that goal.  Total enrollment at the end of open enrollment was 176% of what they had at the end of the first open enrollment last year.

But some enrollees didn’t pay their initial premiums and their coverage was never effectuated, while others opted to cancel their plan early in the year.  And some plans and/or subsidies were terminated because the enrollees didn’t provide adequate verification of immigration or financial data.  By the end of June, 18,065 people had in-force private plan coverage through the Wyoming exchange.

Of the people who selected a plan during the 2015 open enrollment period, 48 percent were new to the exchange for 2015.  Among those who still had coverage in force at the end of June, 92.2 percent received premium subsidies that averaged $424 per month. That’s much higher than the national average, but Wyoming’s unsubsidized health insurance rates are also much higher than the national average, necessitating larger subsidies to keep premiums at the percentage of income determined to be affordable under the ACA.

An additional 847 people enrolled in Medicaid or CHIP through the exchange during the second open enrollment period, qualifying under the state’s unchanged guidelines, as Wyoming has not expanded Medicaid under the ACA.  Medicaid and CHIP enrollment continue year-round.

Wyoming carriers and rates – 2015

Rates decreased in many areas of the country for people willing to switch plans for 2015, but that was not the case in Wyoming.  The NY Times Upshot pegs the increase in benchmark plan premiums in Wyoming at 7 percent or more, although the Kaiser Family Foundation shows the average benchmark plan in Wyoming increasing by just 1.6 percent for 2015.

Across all plans and metal levels in the exchange, a Commonwealth Fund analysis found that rates in Wyoming’s exchange were an average of 5 percent higher in 2015 for a 40 year-old non-smoker.

For people who qualified for subsidies however (roughly 93 percent of enrollees) the state’s high health insurance premiums were dramatically offset by the premium tax credits in 2014, and that continued to be the case in 2015. The average after-subsidy premium for the benchmark plans in Wyoming for a 40-year-old earning $30,000/year was $208 in 2015, a dollar less than it was in 2014.

The federally-run Wyoming health insurance exchange had 40 plans available (up from 18 in 2014) from two health insurance carriers:  Blue Cross Blue Shield of Wyoming and WINHealth Partners, both of which participated in the exchange in 2014.

No Medicaid expansion yet

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 expanded Medicaid under Obamacare, 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 premium is more than five hundred dollars a month.

Medicaid expansion could still come with time. Governor Matt Mead has been discussing the issue with the federal government, and he noted in early November 2014 that HHS is “more open” to modified Medicaid expansion than they were in the past. Shortly after that, the Governor released the details of his Medicaid expansion proposal, which would include modest premiums for enrollees with incomes between 100 percent and 138 percent of poverty, and along with small copays for many newly-eligible enrollees.

But lawmakers proposed a different plan (not vetted for budget neutrality or by HHS) and a Wyoming Senate committee approved a proposal that was essentially a combination of the two. The full Senate ultimately rejected the bill however, and Medicaid expansion was off the table for the 2015 legislative session.

But in the fall of 2015, Mead renewed his push for Medicaid expansion, and presented the legislature with two different budgets – one with Medicaid expansion and one without – so they can see the financial impact of expanding Medicaid. Mead has noted that declining revenue from gas and oil has resulted in the need for a tighter budget in the state, and the federal funding from Medicaid expansion would benefit the state financially – as well as the 17,000 people who are currently in the coverage gap and unable to obtain health insurance.

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.

2014 enrollment numbers

As of April 19, 2014, 11,970 people had enrolled in private plans in the Wyoming exchange.  By mid-May, 92 percent of them had paid their initial premiums.

The total private plan enrollment was the fourth lowest in the country, but Wyoming has the smallest population in the US.

An additional 2,216 exchange applicants had been found to be eligible for the state’s existing (not expanded) Medicaid or CHIP.

Originally, the federal projection was that Wyoming would have 13,000 private plan enrollees by March 31, 2014. That was revised to around 10,000, and officials were optimistic that a March surge in application volume would put total enrollment into the five figure range.  That projection proved to be correct, and the exchange far surpassed the 10,000 mark by the end of the 2014 open enrollment window.

Wyoming exchange history

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 will 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, and the study may take more than two years according to the committee co-chair.  This round of study continues the evaluation process started by the Wyoming Health Insurance Exchange Steering Committee, which Mead appointed in 2011.

Gov. Mead initially refused to expand Medicaid, but began supporting expansion as the year went on.  Two bills that would expand Medicaid passed out of committee in January by a small margin.  Both failed introduction during the budget session in mid-February, and the 2014 legislative session did not result in any further legislation on the issue.

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 the end of 2015.

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.