Insurers file for ACA rate increases for 2017; BCBSNC 18.8 percent, Aetna nearly 24 percent

May 31--DURHAM -- Blue Cross and Blue Shield of North Carolina has filed for an average increase of 18.8 percent in its individual Affordable Care Act plans for 2017 as the company continues to experiences losses in that segment.

Older and sicker customers continue to enroll while the company still has a dearth of younger, healthier enrollees to balance out the risk, said Brian Tajlili, director of actuarial and pricing services for the insurance company.

BCBSNC paid out $1.29 billion in claims for the sickest five percent of its ACA segment last year, which accounted for 70 percent of the company's overall ACA revenue. Over the past two years, BCBSNC has lost more than $400 million on its ACA business.

According to the filings with the NC Department of Insurance made public Tuesday, Aetna Health has also filed for an average ACA rate increase of nearly 24 percent. The other insurer that applied to be on the individual exchange, Cigna HealthCare of North Carolina, will be entering the market in 2017.

Last year, BCBSNC raised its ACA rates by 32.5 percent and dropped its broad-network plans in 16 counties, reducing its ACA enrollment numbers from 397,000 in 2015 to 330,000 in 2016. The company will file rate plans for its grandfathered and transitional ACA plans later this summer.

Tajlili said that drug prices used by a lot of ACA customers continued to rise last year, and that seven drugs cost the company a total $139 million. He also said that ACA customers use the emergency room at a higher rate than other pools, driving up costs, and receive a higher volume of orthopedic procedures.

Tajlili said the company is continuing to evaluate its participation in the ACA and it will make a final decision in August. The company now plans to offer its ACA plans in all 100 counties, and the rate increase range spans 9.4 percent to 28 percent.

Kerry Hall, NCDOI's director of public information, said that the department will be reviewing plans for approval at the state level and the federal government will decide which plans are certified to be sold on the exchange in early September. By later September, insurers must decided which, if any, of the plans will be sold on the exchange.

North Carolina ranks fourth in the country in state ACA enrollment, with more than 610,000 residents enrolled, or about 6 percent of the state population. Tajlili said some regions of the state are more costly than others, driven primarily by underlying costs of providing medical care and provider practice patterns.

"The Affordable Care Act has allowed increased access to medical coverage and that's a good thing," he said. "But increased access comes with a cost."

Follow Alex Dixon on Twitter @amdixon7

___

(c)2016 The Herald-Sun (Durham, N.C.)

Visit The Herald-Sun (Durham, N.C.) at www.heraldsun.com

Distributed by Tribune Content Agency, LLC.