The monthly cost to purchase medical insurance from the state’s individual marketplace is predicted to rise about 11.3% in 2023, though the “Colorado Option” may offer a lower-priced alternative.
The Colorado Division of Insurance released preliminary information Tuesday in regards to the 399 plans that can be available through Connect for Health Colorado, the state-run marketplace. The rates won’t be finalized until mid-October.
The general rates don’t account for any subsidies that buyers receive based on their income. It’s not clear if Congress will extend larger subsidies for marketplace plans before open enrollment starts in November. Connect for Health Colorado CEO Kevin Patterson estimated the additional subsidies lowered premiums about 16% for brand spanking new enrollees.
The Colorado Option isn’t a real public option, within the sense that the state itself isn’t running the insurance plan. The state did set an ordinary plan design, nevertheless, and mandated that some primary care and mental health services be supplied with no out-of-pocket cost. Insurers are offering 42 plans that fit inside that design.
The law that creates the Colorado Option requires it to lower premiums by 5% from their 2021 levels in 2023, with further reductions in the following two years.
The Division of Insurance estimated about 87% of Colorado residents live in an area with at the very least one Colorado Option plan that met the 5% goal available for purchase. It’s possible some others can also have a plan that meets the benchmark, however the division continues to be reviewing the speed filings.
In all counties, there’s a silver Colorado Option plan that’s cheaper than average for the realm, Colorado Insurance Commissioner Michael Conway said. That’s also the case for bronze plans in 62 counties and gold plans in 58 counties, he said. (The metal level gives a rough idea of how a plan is structured, with gold plans requiring higher premiums, but lower out-of-pocket costs in the event you get sick, and bronze plans taking the alternative approach.)
“We’re increasing competition,” he said.
The Colorado Consumer Health Initiative described the proposed rates as concerning, and noted premium increases can be larger for residents of the Eastern Plains and Western Slope.
“At the same time as reinsurance keeps premiums for Coloradans down, and as we see more firms offer plans in additional counties, medical insurance continues to be unaffordable for too many Coloradans,” Mannat Singh, the initiative’s executive director, said in an announcement. “Premium rates have to be reasonable and justified; the industry shouldn’t use the continued pandemic or inflation to hike company profits.”
At this point, the division isn’t expecting any network standoffs, though it’s still reviewing the filings, Conway said.
In 2021, some patients anxious about being unable to see specialists who had treated them before when Anthem and UCHealth couldn’t agree on rates for marketplace plans in Denver. The insurer and the health system reached a deal to bring it back in-network in 2022, meaning patients didn’t face larger out-of-pocket costs in the event that they desired to see doctors employed there.
The insurance division estimated the value of premiums would have risen by closer to 34% if the Centers for Medicare and Medicaid Services hadn’t allowed Colorado to increase the reinsurance program through 2027. Reinsurance is actually a backstop, limiting how much insurers should pay for his or her sickest customers. With lower potential liability, they will set lower rates.
Monthly premiums within the small group marketplace for businesses with not more than 100 employees are expected to rise about 9.2% next 12 months. The division reported 11 firms are offering 497 small group insurance policy. Vibrant Health, which only had 951 enrollees within the small group market, is leaving that business but will keep selling individual plans.
Seven firms will offer individual plans in 2023: Anthem, Vibrant Health, Cigna Health, Denver Health, Friday Health, Kaiser Permanente and Rocky Mountain Health Plans. All counties but Jackson have two or more insurers selling plans.
“There aren’t a ton of oldsters out in Jackson County, so it’s not super-enticing from a competitive standpoint,” Conway said.
Oscar Health, which entered the Colorado marketplace in 2020, will pull out at the top of this 12 months. The insurance division estimated it only enrolled about 3,800 people.
Jackie Kahn, chief communications officer for Oscar Health, said multiple aspects drove the choice to go away, including regulatory changes and a few aspects related to the market itself.
“We intend to make this exit as seamless as possible, while continuing to supply service to the present membership throughout this 12 months,” she said in an announcement.
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