San Juan County faces health care crisis as Lifewise leaves market, leaving residents with single insurance option

By Darrell Kirk

Contributor

San Juan County residents are facing an unprecedented health care insurance crisis as LifeWise Health Plan of Washington announced its departure from the market, leaving the county as the only one in Washington state with just a single insurance provider for 2026.

The change, which takes effect in January, has left many island residents scrambling to understand their options while dealing with dramatic premium increases and shrinking provider networks.

"San Juan County is the only one that has been reduced to one provider," confirmed Justin Paulsen, San Juan County councilman. "We've had providers enter and exit the market over time, but we've never had an instance in San Juan County where we were limited to one, at least under the current Affordable Care Act program."

The sole remaining provider, Coordinated Care Corporation, which operates under the brand name Ambetter, will be the only option for San Juan County residents who buy individual health plans through the state's exchange.

Lisa Duke, a health insurance broker with Safe Harbor Insurance in Friday Harbor, said she received no advance warning from LifeWise. "I found out from one of my LifeWise clients who had received a notice directly from LifeWise," Duke explained.

One of the most pressing concerns is whether local clinics on Orcas and Lopez islands will be in-network providers for Ambetter.

"Ambetter had no in-network services on Lopez or Orcas for 2025 coverage," Duke stated. "The only one in the islands that I'm aware of is Peace Health here in Friday Harbor."

When Duke searched for primary care doctors on Ambetter's website, "nothing came up within 10 miles of me here in Friday Harbor. The closest providers were several people within 50 miles in Oak Harbor."

Duke has written to the Washington Health Plan Finder broker support team, explaining how unrealistic it is for islanders to be expected to travel by ferry for routine doctor visits."

Paulsen emphasized the critical importance of local clinic access: "The first question everyone is asking is whether our local clinics — Friday Harbor, Lopez, and Orcas — will be in-network providers for Coordinated Care Corporation."

Premium increases

San Juan County will have no bronze plans available for 2026. "The only choices for residents will be silver or gold plans," Duke explained. Statewide, insurers received approval for an average 21% rate increase for 2026, with Ambetter specifically raising rates "between 25 and 30% this year."

The rate increases come as enhanced federal tax credits expire on Dec. 31. Washington state officials estimate that approximately 80,000 people statewide may drop coverage if these credits are not renewed. Paulsen believes that figure is conservative. "That sounds low to me," he said. "If the ACA subsidies go away and insurance for a single individual in their 30s costs $1,000 to $1,200 a month, they're not going to get insurance. It's not even a choice — it's a reality that they will not buy insurance."

American Academy of Actuaries weighs in

According to the American Academy of Actuaries in their July 2025 brief "Strategies to Achieve Market Stability in the Individual Health Insurance Market," the individual health insurance market depends fundamentally on risk pooling — grouping individuals together so that higher medical costs of less healthy enrollees are offset by lower costs of healthier ones. The expiration of enhanced premium tax credits at the end of 2025 could particularly impact market stability, as healthier individuals are more likely to forgo insurance when premiums rise, ultimately driving up costs for everyone remaining in the pool. Areas with limited insurer participation face additional challenges, as smaller risk pools may struggle to attract the diverse enrollment needed to keep premiums affordable and maintain adequate provider networks.

"Those subsidies are necessary for people to even entertain having health insurance," Paulsen said. "The compounding issue is that we don't know what federal changes to the ACA might occur. With the discussion of Affordable Care Act subsidies going away, this problem is going to be magnified 1,000% if the exchange is essentially gutted by the elimination of these subsidies."

Paulsen also highlighted the inadequacy of high-deductible plans. "We're going to be asking people to pay $1,000 a month for insurance that has a $12,000 deductible attached to it," he said.

Insurance costs

The health care insurance crisis is part of a broader insurance cost explosion. Paulsen revealed that liability insurance for the county has increased by hundreds of percentage points over the last five years.

Duke confirmed that employer-sponsored group plans are also struggling. "Some of our group plans have already said they're not going to be able to afford a group plan this year for their employees. So some people will be losing their employer-sponsored plan and having to go to this really restrictive individual marketplace."

The emergency services impact

Paulsen painted a dire picture of the cascading effects on emergency services and community health. "If people no longer have insurance or the ability to get an appointment at the medical clinic to deal with ongoing minor issues, those issues will become major problems over time. They will drain our resources because ultimately we still have to provide that acute care response regardless of whether a person is insured or not."

"We will see an increase in chronic conditions. We will see a reduction in preventative care, because if a larger portion of our population doesn't have insurance to cover those expenses, they're simply not going to use the services," Paulsen said.

"The net impact is that all other insurance will become more expensive because our hospitals and medical centers will be overburdened by people who are unable to pay their bills," he added. "You see a net economic impact on the system generally, and you see a net decline in overall health, which is the exact opposite of what our healthcare system should be striving for."

Lopez Clinic

San Juan County Councilwoman Jane Fuller, representing Lopez Island, revealed that the island's clinic faces its own uncertain future. "On June 30th, our Lopez Island Hospital District was informed by UW Medicine that they would be ending their contract with Lopez at the end of June 30th of 2026 and not renewing," Fuller said. "That was pretty shocking news."

Fuller emphasized significant public concern. "There's tremendous public interest in the work, the meetings of the Lopez Island Hospital District. The public is attending in great numbers to track ongoing discussions about what we're going to do as an island that needs a clinic."

Medicaid and Medicare cuts

Fuller highlighted the compounding impact of federal cuts to Medicaid and Medicare. When the San Juan County Board of Health received a presentation from local health officer Dr. Amy Harley, the projections were alarming. "It looks like you could possibly be having upwards of 500 individuals on the island who will no longer have coverage who were previously being covered by Medicaid or Medicare," she said.

In speaking with one business owner on Orcas Island who requested anonymity, the reality of this crisis became personal. The owner has no health insurance but currently has children covered under Apple Health (Medicaid). With changes to Medicaid possible in 2026, parents without insurance would have no way to insure their children if they lose Apple Health coverage. If these same parents were able to find insurance for themselves and their children, the price could quite possibly be out of reach for many.

According to Paulsen, 47% of children in Washington state are insured under Apple Health, per a presentation by Harley in July at a San Juan County Board of Health meeting he attended. He continued that what we are seeing on a national level with health care is magnified here in San Juan County.

Fuller added that Washington state will struggle to backfill federal funding cuts. "The state will be very hard pressed to provide any backfill funding for cuts that are being made federally because they themselves are facing pretty significant financial challenges."

Community collaboration

Fuller emphasized the importance of community solidarity. "What's going to be really important for our community, but also all of our communities across the county, is to support each other and work together to try and find solutions to some of these significant challenges we're going to be seeing in the near term."

Fuller stressed collaboration among health care stakeholders. "What's going to be equally important is ensuring that all the stakeholders who are involved and invested in healthcare provision on our respective islands are talking to each other — that hospital districts are talking to citizens, that the health and community services department is well plugged into what our hospital districts are seeing and dealing with."

She encouraged residents to stay informed without spreading misinformation. "Get interested and curious, but don't get argumentative and confrontational and spread misinformation."

Fuller urged residents to contact their elected representatives. "Citizens can reach out to their federal and state legislators and tell them of their concerns." She specifically mentioned that senators Maria Cantwell and Patty Murray, as well as Rep. Rick Larsen, "want to know what impacts we're seeing and feeling."

Paulsen's final assessment was sobering: "We depend on being able to reliably send people to St. Joseph's in Bellingham, Island Hospital in Anacortes, Skagit Hospital in Mount Vernon, or Fred Hutch in Seattle. We depend on being able to connect people with the resources they need to resolve their medical issues. When the insurance component goes away, we lose the ability to make those connections."

Duke summed up the situation simply: "It feels bleak. I don't know if anything can be improved for 2026, but if not, hopefully for 2027."

Fuller concluded with a message of cautious hope: "Citizen voices are important right now. We have to work together."

Open enrollment for 2026 coverage begins in early November, with coverage taking effect Jan. 1.