Rural Maryland consumers snapped up cheaper health insurance

Baltimore Sun (MD)

Dec. 21--While enrollment in health exchange plans in Maryland this year was up about 2 percent, there were places where policies were downright hot sellers.

Rural counties reported jumps as high as 28 percent from last year. The reason? A "perfect storm" that made some policies sold under the Affordable Care Act the least expensive in the least populated areas.

"Like $5 plans," said David Stewart, program director for the Western Maryland Health Insurance Connector, which helped sign up people in Allegany, Garrett and Washington counties in Western Maryland. "We ran with it."

Almost 157,000 people signed up in Maryland by Dec. 15, when open enrollment for next year closed. That compares with 8.5 million on the federal exchange, a drop of 3.4 percent that officials attributed to people gaining workplace insurance or Medicaid coverage.

Maryland advocates including Leni Preston, vice president of Consumer Health First, said work remains to shore up the system and lure consumers; new enrollments dropped 10 percent in Maryland, for example.

But she said the state and the Maryland Health Benefit Exchange is helping the state outpace the federal marketplace, which has weathered repeated stabs by the Trump administration that included deep cuts to marketing and consumer assistance, as well as some aid to insurers, which have been losing money.

Another challenge has been rising premiums that have burdened consumers nationwide, though a so-called reinsurance program created in Maryland this year lowered some increases and reversed an enrollment slide among those without financial assistance.

A big question also is what ultimately comes of an unexpected ruling just before close of open enrollment by a Texas judge who found the federal health law unconstitutional. Appeals are expected and policies still will go into effect in January.

Rural participation was a particular bright spot for supporters, as well as some smaller upticks in enrollment among young adults, African-Americans and Hispanics.

The actual number of rural consumers remains small. Counties primarily in Western Maryland and on the Eastern Shore enrolled a few as 597 people (Kent County, up 17 percent) while more populated counties enrolled as many as 41,763 (Montgomery County, up 0.4 percent).

There also are higher percentages of people without insurance in rural areas, and the Maryland Health Benefit Exchange targeted its marketing there. But for the most part, the jump likely reflects how costs are calculated.

Most consumers get federal subsidies to buy insurance -- close to 80 percent in Maryland this year. They rise with premiums, where prices are based on the second-lowest cost "silver" plan, a mid-cost policy. There is only one insurer in rural counties, CareFirst BlueCross BlueShield.

Its silver plan became more expensive last year when state regulators allowed an extra price hike on silver plans sold through the exchange because of those Trump administration cuts to insurers. One consequence was far larger federal subsidies for consumers.

Stewart's hypothetical example: A silver plan sold last year cost $800 a month but the subsidy formula says a consumer should pay only $200, so the subsidy is $600. This year, the monthly premium jumped to $1,200, but since the consumer's cost still should be only $200, the subsidy is $1,000. The consumer takes the $1,000 and shops for a plan costing less than $1,200, potentially reducing their premium closer to zero.

The exchange data show many instead decided to buy gold-level plans, which can cost more but have lower out-of-pocket deductibles. The exchange reported enrollment in those plans was up 49 percent to 43,675, while sign-ups in silver plans dropped 12 percent to 74,573.

"It certainly did work for those people in rural countries," Preston said. "What happens next year? Who knows."

Maryland counties where enrollment rose more than 20 percent:

Wicomico -- up 28 percent to 3,037

Somerset -- up 26 percent to 662

Washington -- up 23 percent to 3,808

Allegany -- up 21 percent to 1,358

Dorchester -- up 21 percent to 911

Garrett -- up 21 percent to 1,021

St. Mary's -- up 21 percent to 1,840

Source: Maryland Health Benefit Exchange

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