New details on Affordable Care Act rates for next year show that some areas of the state will see average rate cuts approaching 16 percent, while others will see an 8 percent rate increase on average.
The new information shows the extent of the pricing imbalance across the state when it comes to health care, which tends to be most expensive in rural areas with struggling economies and limited options.
The details were filed last week on a federal website by both Blue Cross and Blue Shield and by Cigna, two of three insurers who plan to offer coverage in North Carolina through the federal health insurance marketplace. The rate requests have to be approved by the N.C. Department of Insurance before the health plans go into effect Jan. 1.
Because Blue Cross is the only insurer that will offer ACA also known as Obamacare, plans in all 100 counties, and currently insures 475,000 under the federal health law, its rate changes will affect tens of thousands of residents who buy individual insurance across the entire state. It plans to offer four ACA plans when open enrollment starts on Nov. 1.
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The rate requests will vary widely. For example, Blue Cross is proposing an average rate cut of 15.85 percent on Blue Value plans in the Triangle as well as Winston-Salem, Hickory, Charlotte, Gastonia and Wilmington, according to federal filings. However, that doesn’t mean that each city will see that average, but only that plans with the Blue Local name will average out that way.
In other parts of the state Blue Cross is proposing an average rate increase of 8.14 percent for its Blue Advantage plans, a 7.97 percent average increase on Blue Select, and a 10.27 percent decrease in its Blue Local plans with Carolinas HealthCare System, now called Atrium.
The plan-specific requests are themselves averages, and individuals and families on those plans could see much larger increases or decreases. The plans differ in pricing based on the way their benefits are structured, so that plans with higher annual deductibles tend to have lower monthly premiums. And the plans are priced specifically in each of North Carolina’s 16 rating areas, which effectively function as their own health insurance markets governed by local economic forces and medical pricing trends.
Last week Blue Cross announced that it is asking the N.C. Department of Insurance for a statewide average rate cut of 4.1 percent, explaining that it was able to sign lower-cost reimbursement contracts with hospitals and other providers across the state.
Blue Cross said it’s not providing more rate details for competitive reasons until the rates are approved by state regulators.
Cigna, which sells ACA plans in five North Carolina counties, declined to disclose its rate request last week, citing company policy. But its federal filing shows the company is seeking a 3.6 percent average increase for the five counties: Wake, Durham, Orange, Chatham, Nash.
Centene plans to offer its Ambetter plan in Wake and Durham counties. The company, which insures 1.5 million people in 16 states under the ACA, is offering ACA plans for the first time in this state.
In North Carolina, about 500,000 are covered by ACA plans, and about 90 percent of them qualify for federal subsidies to offset their premium costs, and in some cases, their deductibles and copays.
All rate request filings are considered trade secrets under North Carolina law and not publicly available. The percentage changes reflect the amount of money an insurer expects to collect in one year from monthly premiums paid by its customers.
In addition to the monthly premiums, however, customers must also pay annual deductibles and co-pays, so that the cost to any specific customer is not limited to monthly premiums but pegged to the amount of health care that customers uses.