Insurance turmoil expected as rates climb for some consumers
Massachusetts Health Connector officials are bracing for disruption as people who buy their own health insurance start signing up for coverage on Tuesday, the first day of the three-month enrollment period. A significant minority of Connector customers face big increases in premiums and may decide to change plans.
The Connector estimates that nearly one-quarter of its subscribers will have to pay premiums that are at least 15 percent higher in 2017 if they want to keep their current plan.
But most Connector customers will see small increases or even decreases in their premium costs. This stands in stark contrast to the experience throughout much of the country for consumers who get their insurance through the Affordable Care Act; nationally, premiums for midlevel plans are increasing an average of 25 percent.
The Connector is a state agency serving people who don’t obtain health insurance through an employer. It enrolls 234,000 people, of whom 183,000 qualify for premium-lowering subsidies based on income. Ten insurers are offering 62 plans for next year.
Among the subsidized plans offered in Massachusetts, one of the most popular has imposed a major cost spike: Neighborhood Health Plan, which has boosted premiums an average of 21 percent.
Neighborhood, which is owned by Partners HealthCare, is the only plan sold through the Connector with a network that includes the Partners hospitals, notably Massachusetts General and Brigham and Women’s. Switching to a less-expensive plan will limit access to those hospitals, and to doctors exclusively affiliated with Partners. Subscribers who leave Neighborhood for a more affordable plan may need to find new providers.
“Last year, we had a very passive open enrollment. Most people didn’t need to change their plan,” said Hannah Frigand, manager of the consumer HelpLine (800-272-4232) run by the advocacy group Health Care for All. This year, she said, the challenge will be educating consumers about their options. A search tool on the Connector website (www.mahealthconnector.org) allows customers to easily determine which plan’s network includes their doctor, Frigand said.
To prepare for these transitions, the Connector has provided additional training to enrollment assisters and beefed up staffing at its call center, with plans to deploy 350 workers at peak times. Starting Tuesday, the call center (877-623-6765) will have extended hours, and six walk-in sites will be open around the state.
Insurers are also ready for the onslaught, said Eric Linzer, spokesman for the Massachusetts Association of Health Plans, an insurers’ trade group. “Plans are staffing their call centers,” he said. “We’re prepared to help members with any questions they have.”
Another complicating factor concerns the subsidies that 8 in 10 Connector members receive to lower their premiums, based on income. This year, the federal government is requiring verification of income with the Internal Revenue Service and the state Department of Revenue. This could lead to people learning they’re not eligible for subsidies or eligible for a different level of subsidy than in the past.
Additionally, for the first time, people will lose their subsidies altogether if they failed to file a 2015 tax return. The state has identified 4,758 enrollees who did not file taxes. Once they file, they may reapply for the aid.
Why are rates overall on the Massachusetts Connector increasing so much less than on health insurance exchanges elsewhere?
Louis Gutierrez, the Connector’s executive director, said the state’s competitive insurance marketplace drives prices down, with numerous insurers jostling to offer the lowest-cost plan. Another factor is the state’s long experience with near-universal health coverage.
“Because so much of the Massachusetts population is already insured, we are not seeing large pockets of very ill and expensive members coming in to get insurance coverage,” Gutierrez said.
Connector enrollees who buy insurance without subsidies — a relatively small group — face bigger increases, an average of 19 percent. Most of that increase is attributable to two health plans: Harvard Pilgrim Health Care, with a 47 percent average increase, and Neighborhood, going up 25 percent.
The open enrollment period continues through Jan. 31.