The four health insurance companies offering individual plans in Georgia are no longer threatening to break consumers’ piggy banks.
After jacking up rates well into the double digits this year, insurers participating in the state’s health insurance exchange are seeking only modest increases in 2019.
However, a Trump administration announcement that it’s freezing payments under a federal program that protects insurers from losses incurred from covering sicker patients — which came July 7, one day after the Georgia Department of Insurance released the proposed 2019 premiums — could still mean significantly higher premiums next year.
Only one of the four insurers in Georgia’s health exchange are asking the state for a double-digit premium increase in 2019. Kaiser Foundation Health Plan is seeking to raise rates by 14.7 percent.
The other three participating insurers are looking for more modest single-digit increases, ranging from 2.2 percent sought by Blue Cross Blue Shield of Georgia to 8.8 percent proposed by Ambetter Peach State.
All four companies raised premiums this year by double digits.
Health policy experts say a key driver of this year’s premium hikes was uncertainty over whether and to what extent the Republican-controlled Congress would roll back provisions of the Affordable Care Act (ACA), also known as Obamacare, passed in 2010 by a then-Democratic Congress.
Lawmakers were able to muster the vote to repeal the individual mandate requiring Americans to buy health coverage or pay a penalty. But getting rid of the mandate had less impact on the industry than insurers had anticipated, said Bill Custer, director of the Center for Health Services Research at Georgia State University.
“They built in the shock last year, the anticipated shocks of removal of the individual mandate,” he said. “[But] the individual market in the exchange was surprisingly resilient.”
Laura Harker, health policy analyst for the Georgia Budget and Policy Institute, noted that enrollment in the Georgia insurance exchange declined only slightly this year — from 493,000 to 480,000 — despite congressional efforts to repeal and replace the ACA.
“These rates reflect a more stable market,” she said. “The marketplace in Georgia has a better sense of the risks that, over several years, have caught up with some of the cost increases that have occurred.”
Custer said the double-digit premium hike being sought by Kaiser likely results from a huge increase in enrollees who signed up for the company’s individual plan this year. When Blue Cross Blue Shield dropped out of the Atlanta market at the end of last year, Kaiser picked up a lot of those enrollees, he said.
Blue Cross Blue Shield is planning to return to most of the Atlanta market in 2019.
“It will be interesting to see how that works out,” Custer said.
The state has until Aug. 22 to approve or reject the proposed premiums and send them on to the federal government for review.
Between now and then, those requests could change as a result of the July 7 announcement by the federal Centers for Medicare & Medicaid Services (CMMS). Citing a federal court ruling earlier this year, the agency said it would be forced to suspend “risk-adjustment” payments that help insurers that cover sicker patients offset losses.
“Risk adjustment protects insurers that attract higher risks,” Custer said. “It mitigated the incentive of insurers to seek good risks and try to avoid bad risks. … [Without the payments], all insurers face higher risks than they did before. … Unless that changes, you can anticipate all insurers will come back with higher rates.”