Pennsylvania: Preliminary 2019 ACA rate hike request: Only 4.9% thanks to state efforts to counter sabotage!

2019 OPEN ENROLLMENT ENDS (most states)

Time: D H M S

This is huge news given that Pennsylvania is the 5th largest state in the country (and a swing state to boot)...but it's also incredibly frustrating due what isn't included. From an official Pennsylvania Insurance Dept. Press Release:

Health Insurance Plan Rates Stabilize, Offer More Choice for Consumers Despite Federal Government Sabotage

Harrisburg, PA – Insurance Commissioner Jessica Altman today announced that health insurance rates in Pennsylvania have moderated significantly, counter to the national trend, after Wolf Administration efforts to combat the effects of sabotage on health insurance markets by the federal government and specifically the Trump Administration to dismantle the Affordable Care Act (ACA). Importantly, the filings indicate that rate increases in Pennsylvania will be significantly more modest in 2019 than other states and many consumers will see more choices in their local markets as a result of Pennsylvania's efforts to increase competition.

The individual and small group insurance markets have been subject to intense and deliberate sabotage by the federal government in the past year, including: the elimination of cost-sharing reductions, shortening of the open enrollment period, slashed federal funding for outreach to consumers, the elimination of the individual mandate, and the continual threat of the repeal of the ACA, which has created instability and uncertainty for insurers and consumers.

Wow! The PA Insurance Dept. is making absolutely no bones about the mountain of crap the Trump Administration tried to pull last year...nor are they pulling their punches about this year's attempts to gum up the works in 2019:

“Despite these efforts, under the leadership of Gov. Tom Wolf, our department has made it a top priority to ensure that Pennsylvanians have access to affordable coverage options. Building on this progress, the modest rate requests and increased competition are further indications that the ACA is working in Pennsylvania,” Altman said. “However, the ongoing attempts and recent proposed rules being considered at the federal level to dismantle the ACA still have the potential to jeopardize market stability in future years and negatively impact health insurance consumers. We will continue to work to protect the progress we have made, including Pennsylvania's lowest uninsured rate on record, and make affordability and access our top priorities for consumers.”

The health insurers that currently sell in Pennsylvania’s individual market will all stay in the market and filed plans for 2019 requesting aggregate statewide increases of 4.9 percent. In addition, the insurers that currently sell in Pennsylvania’s small group market filed plans requesting aggregate statewide increases of 3 percent. For context, in neighboring states, insurers are asking for average rate increases above 20 percent for 2019 coverage.

Last year Pennsylvania carriers announced that they were raising their 2018 rates an ugly 30.6% overall, largely in response to Donald Trump cutting off CSR reimbursement payments. Thanks to the PA insurance department actively pushing the #SilverSwitcharoo workaround along with other measures noted below, they seem to have effectively done a great job of cancelling out the damage.

OK, so what's the frustrating part? Skip down to the last paragraph: The actual rate filings/etc. won't be made public until July 23rd, so I presume there's no way of seeing just what impact this year's sabotage efforts (mandate repeal, #ShortAssPlans) have on that 4.9% aggregate increase. My suspicion is that most of the carriers would be reducing rates in 2019 if not for those factors, but untile I can see the filings (or unless some of the carriers are willing to state the impact in a press release/etc) there's no way of knowing for sure.

For example: The Urban Institute has projected that the combination of mandate repeal + #ShortAssPlans will tack an extra 19.2% onto Pennsylvania rates in 2019. If that's accurate, that would suggest that absent those factors, PA carriers would actually be dropping 2019 rates by a good 14.3%. Again, however, I'll have to wait for the actual filings to get a sense of how close/far off this is.

UPDATE: I'm instituting a new rule of thumb: In any state where I'm relying on the Urban Institute projections (that is, states where neither the carriers nor the state insurance dept. gives hard guidance about what portion of the 2019 rate increase is due specifically to mandate repeal and/or #ShortAssPlans), I'm going to err on the side of caution and assume only 2/3 of Urban's projection for that state.

For instance, in Pennsylvania, Urban projected a 19.2% increase due to these factors. 2/3 of that is 12.8%. Therefore, until/unless I have a more specific estimate, I'm going to assume that without the mandate repeal/#ShortAssPlans factors, Pennsylvania carriers would be requesting a 7.9% rate decrease (4.9% - 12.8%) next year.

Some more good news out of PA:

Many consumers will also have increased choice: as filed, 31 of Pennsylvania’s 67 counties will have more health insurers offering coverage in the individual market next year. Further, the number of counties with just one health insurer offering coverage in the individual market will decrease from 20 to eight. Final rates for 2019 will not be approved until the fall, and Altman noted that insurers can make changes to their geographic footprint before their final rates are approved.

Altman attributes the minimal increases to Pennsylvania’s competitive market and the department’s efforts to maintain enrollment in the individual market despite the federal government’s efforts to shorten the ACA’s open enrollment period and curtail enrollment outreach, while working to achieve affordability for consumers. The Insurance Department launched an outreach campaign to make up for a lack of marketing from the federal government during the 2018 open enrollment season.

The department also worked to make coverage more affordable for more consumers by mitigating the number of individuals subject to premium increases when the federal government eliminated cost-sharing reduction reimbursements. As a result, 396,725 Pennsylvanians selected health plans on the exchange in 2018, only a small decline from the previous year.

In other words, as I noted above: The #SilverSwitcharoo worked very well in Pennsylvania.

Of course, Silver Loading and Silver Switching are still facing an existential threat from CMS Administrator Seema Verma, who is refusing to rule out stopping those pricing strategies for 2019 and beyond. If that were to happen, millions of people taking advantage of low-price Gold plans (and dirt-cheap Bronze plans in some cases) would see those bargains disappear and their rates would once again skyrocket even after subsidies.

Pennsylvania is at an all-time low rate of uninsured individuals at just 5.6 percent. More than 1.1 million Pennsylvanians have gained access to health care coverage only available to them because of the ACA and Gov. Wolf’s critical decision to expand access to the Medicaid program, Altman explained.

“Our review of the requested rate changes shows that the health insurance market in Pennsylvania is becoming more competitive to the benefit of consumers,” Altman said. “Although rates will not be finalized until this fall, I’m encouraged by the aggregate numbers and pleased to see that consumers across Pennsylvania will have more choices to cover their health needs.”

Rate filings for 2019 health insurance plans were submitted to the Insurance Department on May 21. Proposed rate changes vary by plan and region and are subject to change by the department as part of the review process. Complete rate filing requests, including plan-specific information, will be available on July 23 at www.insurance.pa.gov and final rates, as approved by the commissioner, will be made available this fall.