Blues plans in many states will continue to offer individual policies on the Affordable Care Act (ACA) exchanges, but high-profile state withdrawals by insurers such as Anthem, Inc. and Wellmark Blue Cross and Blue Shield will limit the overall Blues footprint on the individual market for 2018. But looking ahead, Blues plans may see renewed growth in the individual segment if President Trump’s Oct. 12 executive order leads to more short-term individual policies and expanded association plans (HPW 10/23/17, p. 1), one industry insider predicts.
For now, however, those Blues plans staying in their state exchange markets are warning of depressed enrollment due to higher rates, a shorter sign-up period, limited HHS marketing and customer confusion. In response, many Blues plans are putting extra resources into their marketing budgets, particularly since HHS slashed its own promotion budget.
Independence Blue Cross (IBC) increased its marketing budget, with plans to advertise via local newspapers, billboards and bus shelters; it also will use direct mail, email, text messages and other forms of digital marketing, says Paula Sunshine, senior vice president and chief marketing officer.
Blues’ Individual Market Falls
For 2018, IBC is the only insurer offering plans both on and off the marketplace in the region. The insurer will offer 15 different HMO and PPO plans across all metallic levels on-exchange and 17 plans across all metallic levels off-exchange, Sunshine tells AIS Health, adding that IBC expects “some softening in the market.”
IBC submitted rate increases that average 22% for 2018, Sunshine says, with some variation by product. For example, rates for Independence’s off-exchange Silver HMO Proactive plan will increase just 8%, while premiums for the on-market Silver HMO Proactive plan will rise 24%.
HCSC Educates on Plan Options
Health Care Service Corp. (HCSC) also will offer plans both on-exchange and off-exchange in all counties across its service area of Illinois, Montana, New Mexico, Oklahoma and Texas, says spokesperson Kristen Cunningham. HCSC has “improved our online experience” to educate customers about key open enrollment dates and subsidies. “We’ll also be reaching out to consumers through a variety of digital channels, TV, radio and direct mail to inform them of their health care options this year,” she says. “We have new TV and radio ads focused on helping members understand available financial assistance options, as well as informing them of the shorter open enrollment period.”
Likewise, Horizon Blue Cross Blue Shield of New Jersey says it will enhance outreach efforts in response to federal cutbacks. “We are putting unprecedented resources into this effort through community-based outreach, expanding our footprint in malls throughout the state, hosting regular grassroots education events and making agents available in person, on the phone or online,” says Michael Considine, vice president of consumer, small group and mid-size market units.
Blues plans generally have made the decision to stay in the individual ACA exchanges or to exit on a state-by-state basis. For example:
Anthem, Inc. exited 56 of its 143 rating regions for 2018, representing a little more than half of its current 1.4 million members in individual ACA-compliant plans.
Wellmark Blue Cross and Blue Shield, which had pulled out of South Dakota’s ACA-compliant individual market for 2017, will not sell or renew individual ACA plans in Iowa for 2018.
Florida Blue will remain on the exchanges in all 67 Florida counties.
Blue Cross and Blue Shield of North Carolina said it will offer ACA plans in all 100 counties for 2018 after the state approved an average rate hike of 14.1%, down from 22.9% initially requested.
Horizon said it will continue to offer individual policies throughout New Jersey for 2018, with on-exchange rates rising 16% to 28%.
If challenges in the individual market continue, more Blues plans could elect to exit, says Ashraf Shehata, principal and health care leader at KPMG LLP in Cincinnati. “At the end of the day, [the Blues’] focus is going to be on their commercial business,” he tells AIS Health. That being said, they will remain “if the insurance market is stable, if they can price a realistic product, and if the risks are known,” he says.
Trump’s Oct. 12 executive order, which has not yet been translated into regulations, would allow association health plans to sell across state lines without meeting ACA mandates and would permit “short-term” insurance policies longer than the current three-month maximum.
“If consumers are going to be able to buy short-term coverage and association plans, the Blues are very good at that,” Shehata says. As 2018 progresses, he says he anticipates seeing Blues plans move into those markets, especially since their broad network of agents and brokers can help sell those policies.
In addition, some Blues plans may decide to revisit direct-to-consumer sales for these new short-term and association products, he says. “About five to seven years ago, many of the Blues were planning to go direct to consumer,” he says. “They pulled back from a lot of it, but they may need to reinvest.”