Turmoil in Washington colors 2017 open enrollment

Oct. 02--Usually, the annual ritual of selecting the right health plan for the coming year is quite predictable. The options are there on the table, and there is usually little thought that things might change dramatically after you make a decision.

Not this year.

The president tweeted this summer he might end cost-sharing subsidies to health insurance companies if Congress can't get together on long-promised plans to repeal and replace the Affordable Care Act. So open enrollment this season comes with an unprecedented edge of unease.

Dave Jones, California's health insurance commissioner, does not attempt to sugarcoat the effect that so much heated rhetoric has had on the task of getting insurance companies to offer affordable rates to consumers, especially in the private health insurance market now dominated by the Covered California health insurance exchange.

"This has been the most unstable and challenged health insurance market in my tenure as a public servant," Jones said. "The degree of uncertainty and instability that the Trump administration has injected into the market this year cannot be understated."

That turmoil has most directly affected the 1.4 million Californians who buy exchange plans and about 1 million more estimated to purchase individual coverage plans off-exchange.

It is this group, plus 3.8 million California adults enrolled in Medi-Cal since it was expanded in 2014, whose coverage has been the subject of political debate for several years.

While attempts to repeal and replace the Affordable Care Act have failed, there are still several steps the president could take to undermine the controversial program.

Already the new administration has said it would not enforce the penalties assessed for those who don't buy health insurance. And his decision to target out-of-pocket cost-reducing payments to insurance companies also introduced a fair bit of volatility.

There has also been talk that the federal government will not support outreach efforts to some types of potential policyholders, especially those in Latino communities. Enrollment there is often seen as critical to bringing in enough healthy people to offset the costs incurred by older and sicker Americans who are much more likely to sign up for coverage.

On Aug. 1, Peter Lee, Covered California's director, said the average increase for exchange plan premiums in 2018 will be 12.5 percent. He attributed about 3 percent of that bump to insurance company uncertainty about whether or not the new administration will undermine existing Affordable Care Act programs.

While the average increase will be nearly 13 percent, Lee said in some cases policyholders will be able to limit their premium hikes to less than 4 percent by moving into a different plan within their home market. In San Diego County, exchange customers will have six different carriers to choose from this fall, down one from this year due to the decision of Anthem Blue Cross to pull out of California's individual market in most regions.

Of course, the individual health care market is only a small fraction -- about 9 percent in California -- of the overall health insurance pie. The largest segment, representing 45 percent of all Californians in 2015 according to the Kaiser Family Foundation, get their coverage from an employer. An additional 38 percent is enrolled in a government program such as Medicare and Medi-Cal.

It's a little harder to peg just how much premiums for employer-sponsored plans will increase in 2018.

Every year the National Business Group on Health surveys large employers nationwide to get a sense of how much costs will increase in the coming year. This time around, the nonprofit announced that costs were up about 5 percent, a number that should roughly translate to the premium increase that employees of large companies will see in 2018, according to Brian Marcotte, the business group's president and chief executive.

He said employers are continuing strategies that have gradually come to the fore over the last few years to contain health care costs as much as possible.

Most companies, he said, are building in income-based premiums for employees. Gone are the days when the premium list was the same for everyone on the payroll.

"That means if you make more, you end up paying a higher monthly premium," Marcotte said.

And there has also been a big increase in the number of employers offering "self-directed health plans" that combine high deductibles with special health savings accounts that the employer funds to help defray costs. The average contribution, Marcotte said, is $650 per year for an individual and $1,000 per family. Average deductibles for these plans, he added, are $1,500 per individual and $3,250 per year for family coverage.

"Today we have 90 percent of large employers offering self-directed plans with attached health savings accounts and 40 percent are offering these as their only option in 2018," Marcotte said.

Companies are choosing these options to help control the amount of health-care services their employees use, he said.

Jones, the insurance commissioner, said no statewide average has been calculated for premium increases among small- and medium-sized plans, but he has seen proposals from many carriers that give him a general sense of the range for 2018.

"On an annualized basis, I'd say it's probably running somewhere between 8 percent to 10 percent," Jones said.

As to those buying through Covered California, or in the individual market outside the exchange, Jones said he knows there is significant anxiety among everyday consumers. But even if there is a sudden change in the congressional logjam and the ACA is repealed immediately, he said the 70 percent of Covered California policyholders who are getting significant portions of their premiums covered by subsidies should not be left suddenly paying full freight.

"If that were to happen, and I think the possibility is extremely remote at this point, people would be able to get out of their plans because they are currently predicated on them receiving premium assistance," Jones said.

Important dates

* Covered California open enrollment: Nov. 1 -- Jan. 31. Apply by Dec. 15 for coverage that starts on Jan. 1, 2018.

* Employer-sponsored plans: Open enrollment periods vary by company but most occur in the fall. Check with your human resources director for details.

* Medicare: Oct. 15 -- Dec. 7. Newly-selected coverage starts Jan. 1, 2018.

Who needs to pay extra attention?

* More than 4,000 San Diego County residents are currently covered by Anthem Blue Cross plans through the Covered California health insurance exchange. If you or a family member is in one of these plans, you will have to choose a new option for 2018 because Anthem announced in August that it is pulling out of nearly all individual health insurance markets.

* An estimated 150,000 Anthem customers currently have individual market plans sold outside the exchange. These plans will also be canceled, so don't think that, if you didn't buy through Covered California, your plan will be continued.

* Molina Healthcare, which covers 21,400 people in San Diego County, notified the public of large insurance premium increases for 2018 in most of the markets its serves. In San Diego County, increases will range from 18 percent to 31 percent depending on age.

* Blue Shield of California will significantly decrease its premiums in 2018, dropping them somewhere between 3 percent and 16 percent in California, depending on age.

paul.sisson@sduniontribune.com

(619) 293-1850

Twitter: @paulsisson

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