Blue Cross Warns Of Higher Exchange Premiums

April 25--Blue Cross and Blue Shield of Illinois has not decided whether it will continue to offer plans on the Obamacare exchange next year, but if it does, exchange plan prices could rise "significantly" depending on political leaders' actions, according to the company.

Jill Wolowitz, the insurer's vice president of government and community relations, said Tuesday the insurer hopes to continue to offer plans on the exchange next year, but several proposed changes "would have an impact on rates and also our decision."

Insurers have until June 21 to file proposed rates if they plan to stay on the Illinois exchange in 2018.

Some insurers already have bowed out of exchanges in other parts of the country, amid uncertainty over the future of the Affordable Care Act. If Blue Cross and Blue Shield of Illinois were to pull out, it would be a big deal: The insurer is the only one that offers individual PPO plans, not just HMO plans, on the exchange this year.

Blue Cross and Blue Shield is also the only insurer offering individual exchange plans in Lake County. It's one of three insurers offering such plans in Cook and DuPage counties.

Attempts to reach Celtic were unsuccessful Tuesday. A Cigna spokesman declined to comment. Both insurers also offer exchange plans in Cook County.

This year, more than 356,000 Illinois residents are covered by plans bought on the exchange.

Wolowitz said Blue Cross is particularly concerned with at least two potential changes, as it decides whether to stay on the exchange and how much to charge for its plans.

Republicans have proposed doing away with Obamacare's requirement that everyone have health insurance or pay a penalty. It's unclear, even without legislation, whether the Trump administration plans to enforce that requirement. If that mandate vanishes, it could lead fewer healthy people to purchase health insurance. Insurers rely on healthy members to help balance out the costs of paying for sicker members.

Insurers also are concerned that cost-sharing reduction payments might disappear -- that's money companies get from the federal government to help offset the expense of reducing deductible and copayment costs for lower-income members.

When Barack Obama was still president, House Republicans challenged those payments in federal court, and the court ruled in House Republicans' favor. The Obama administration appealed that ruling.

But now that the Obama administration is out, President Donald Trump could drop the administration's appeal -- and stop the payments. The White House has said that Obamacare is "collapsing on its own" and must be repealed and replaced.

Stopping those payments, along with no longer enforcing the rule that everyone get health insurance or pay a penalty, could "raise premiums a significant amount," Wolowitz said.

Blue Cross already raised premiums for individual exchange plans in Illinois this year by 43 to 60 percent.

Wolowitz said she expects Blue Cross will file proposed rates by June, and said she expects insurers will make final decisions about whether to participate over the summer.

The Henry J. Kaiser Family Foundation has estimated that erasing cost-sharing reduction payments would lead to a 15 percent increase in the premiums of silver exchange plans in states that expanded Medicaid, like Illinois.

Consumer tax credits would also rise to help offset higher premiums, meaning many consumers wouldn't be affected by those higher premiums, according to Kaiser. But the roughly 25 percent of Illinois exchange members who don't get tax credits might have to pay the full, higher amounts, said Cynthia Cox, Kaiser associate director of health reform and private insurance.

Kaiser also estimates that cutting cost-sharing reduction payments wouldn't actually save the government money. The federal government would end up paying an additional $2.3 billion in 2018 for the higher tax credits, according to Kaiser.

Cox said it's difficult for insurers to make choices about what to offer next year while the law and many of its elements remain in flux. Republicans are again talking about voting on health care legislation, but it's uncertain when that might happen.

"They can work with a certain amount of uncertainty over who is signing up for their plans," Cox said of insurers. "What they are not equipped for is not knowing what the basic rules are going to be."

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