Without Aetna and United Healthcare, Philly area faces hefty increases for Affordable Care Act rates

Oct. 17--Because of decisions by United Healthcare and Aetna to withdraw from Affordable Care Act exchanges in Pennsylvania for 2017, the remaining insurer in the Philadelphia area, Independence Blue Cross, has been granted bigger rate increases than it requested in the spring, the state Insurance Department said Monday.

The Insurance Department said additional, unnamed companies were considering ending their ACA individual-exchange businesses in Pennsylvania. If that happened, some counties might have been left without any offerings on the exchange, which is where individuals have to buy plans to qualify for federal subsidies.

In a bid to keep at least one insurer on the exchange in every county, "the department allowed insurers to adjust their rate filings to reflect their emerging 2016 experience and their concerns regarding potentially large influxes of enrollment due to the ongoing volatility in the individual market," regulators said in a filing approving an average rate increase of 28.4 percent for individual plans offered by IBC subsidiary QCC Insurance Co. QCC had requested 23.8 percent in the spring.

The approved increases for QCC, which sells traditional preferred-provider plans, ranged from 16.6 percent to 39.9 percent, regulators said. The lowest monthly premium for a 40-year-old nonsmoker in a mid-range "silver" plan will increase 16.6 percent, to $454.95 per month, from $389.18 per month, not counting any subsidy.

The Insurance Department approved a 28 percent average rate increase for IBC's Keystone Health Plan East unit, which sells HMO plans, up from the 20 percent initially requested, the filing said.

The HMO increases ranged from 12.1 percent to 39.5 percent. A 40-year-old non-smoker will pay $373.94 a month, up 35 percent from $276.01, for a mid-range plan.

"It is the department's hope that this rate increase represents a one-time correction to previous underpricing, and that in future years insurers will not need rate increases significantly above standard increases in medical costs," regulators said in the rate-approval filings for IBC, the biggest insurer in five-county Philadelphia region.

Jonathan Gold, a spokesman for the U.S. Department of Health and Human Services, cautioned that "the overwhelmingly majority of consumers will not be paying these increases" because of subsidies.

"Headline rate changes do not reflect what these consumers actually pay because tax credits reduce the cost of coverage below the sticker price and shopping helps consumers find the best deal," Gold said.

The plans in question are largely for individuals who cannot get group insurance through their employers. Consumers can start shopping online Nov. 1 for 2017 plans at www.healthcare.gov. Open enrollment runs through Jan. 31.

Monthly premiums are just part of the cost for consumers -- they do not include out-of-pocket expenses, such as deductibles and co-pays. In many parts of Pennsylvania, more than one insurer is offering plans on the exchange. Even in Southeastern Pennsylvania, where IBC is the only company on the exchange, consumers will have a dozen plans to choose from, ranging in price for a 21-year-old non-smoker from $232.13 per month for so-called "catastrophic" coverage to $620.66 per month for Personal Choice PPO Platinum.

"Making sure the public is aware of these increases now is important to give consumers the time they need to make the best health-care decision for both themselves and their families, said Insurance Commissioner Teresa Miller. "However, these rate increases make it clear that Washington needs to move swiftly to address consumer needs under the Affordable Care Act."

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