California: Head of CoveredCA confirms...exactly what I said the other day.
2018 MIDTERM ELECTION
Time: D H M S
There you have it: The states which are 100% on board with the ACA exchange provisions (running their own full state-based marketplace, expanding medicaid and sticking to the original cut-off date for "transitional" policies) average around 18%. If you remove Minnesota from the equation, it's just 15.2%.
Those which implemented only one or two of the above provisions come in at around 26%. In a possibly coincidental quirk, all five fo the "halfway" state exchange states (Hawaii, Oregon, Nevada, Kentucky and New Mexico) just happen to also fall into this category as well, which is completely appropriate.
Finally, states which are fighting the ACA kicking and screaming (no Medicaid expansion, no state exchange and allowing transitional plan extensions as long as possible) are averaging around 30%.
Make of that what you will.
Q: For 2017, Covered California’s average premiums went up by double digits for the first time. Is this the beginning of more rate hikes ahead?
A: Next year, we expect they will be down to single digits, more like the 4 percent increases we had the last two years. We’re very optimistic.
California as a state did two things that are part of why we have a rate increase that is half of the national increase. And why it’s very likely to be only a one-year adjustment. First, we expanded Medicaid eligibility. States that did not expand have bigger cost increases (in 2017). We also converted the entire individual market to ACA (Affordable Care Act) plans the first year. (Under Obamacare, states had until 2018 to make all of their plans ACA compliant, such as eliminating exclusions for pre-existing conditions.) We ripped the Band-Aid off the first year. In 2014, we had some unhappy consumers. They had to go out and buy new insurance plans. ... The 30 states that didn’t do that for the last three years have had a bunch of citizens who were not part of the common risk pool. By definition, they were healthier. But health plans didn’t know who to price for. … (Insurers) did their best efforts to price right for 2016 and got it wrong. If you don’t know who you’re insuring, you can get it wrong. ... In California, we do have a good risk mix, young and old and particularly healthy.
Well, now (in addition to him mentioning Medicaid expansion and not offering transitional plans, there's also the fact that CoveredCA is itself a state-based exchange, the third factor from my analysis).
Lee also mentions CoveredCA's #OE4 enrollment target...although, as usual with Lee, he only mentions the number of new enrollees, not how many current enrollees they anticipate retaining:
Q: What’s the 2017 enrollment goal?
A: We have 1.3 million enrollees currently. We anticipate signing up 400,000 new people during open enrollment. ... You go into Modesto, East L.A., Oakland, Palm Springs and you will see a storefront emblazoned with a Covered California logo. That’s not a government office; those are private, independent insurance agents beating the bushes to get people insured. We have 14,000 licensed insurance agents that are committed to selling Californians individual insurance on and off the exchange.
Now, technically, CoveredCA had 1.575 million people select QHPs during Open Enrollment last year, so it's conceivable that their actual OE4 projection is as high as 1.975 million, but I'm fairly certain that's now what Lee means. Due to non-payments and attrition throughout the year, they're now down to the 1.3 million who are still effectuated...which happens to be the same number at this point last year. Of those, about 1.13 million Californians renewed their policies, a renewal rate of around 87%.
Assuming a similar renewal rate this year, that should mean a similar 1.13 million renewals, plus an additional 400K, for a total of 1.53 million...or pretty much even year over year.