New rules limit United Health plans to 13 counties
Because of a new restriction designed to limit the cost of the state’s private option, plans offered by UnitedHealth Group are available this year only to enrollees in 13 of the state’s 75 counties, a spokesman for the state Department of Human Services said last week.
Plans offered by the four other companies participating in the expanded Medicaid program are available to private-option enrollees statewide, just as they were last year, Human Services Department spokesman Amy Webb said.
Under the private option, the state buys coverage on the federally run health insurance exchange for adults who have incomes of up to 138 percent of the poverty level: $16,243 for an individual, for instance, or $33,465 for a family of four.
The coverage is provided through silver-level plans, which are designed to cover 70 percent of a typical patient’s medical expenses.
For private-option enrollees, the Medicaid program pays the monthly premium and provides additional subsidies that reduce or eliminate the enrollees’ required out-of-pocket spending for medical care.
Last year, Webb said, Arkansans eligible for the private option could enroll in any company’s silver plan
that met certain requirements. That included offering only the benefits required by state law and the 2010 federal Patient Protection and Affordable Care Act.
This year, such a plan must also be the cheapest or second-cheapest plan that meets the requirements in its coverage region or have a monthly premium that is within 10 percent of the premium for the region’s second-cheapest plan.
One of UnitedHealth Group’s plans, called Silver Compass Plus 4500, met the private-option program’s requirements in the state’s central region, which includes Pulaski County, but not in the other six regions.
For instance, in the northwestern region, the plan’s monthly premium for a 40-year-old is $409.13.
That’s about 34 percent higher than the premium of $306.36 a month that the Medicaid program will pay
for enrollees of that age in the region’s second-cheapest qualifying plan, offered by Arkansas Blue Cross and Blue Shield.
Sen. David Sanders, R-Little Rock, and a sponsor of the law creating the private option, said the restriction on premiums is part of an effort to “inject price sensitivity and more competition into the program.”
“Obviously, there will be some who will be able to get there, and some who won’t be able to get there,” Sanders said.
Almost 199,000 Arkansans were enrolled in the private option as of Oct. 15, according the Human Services Department.
As of June 30, more than 140,000 enrollees were in plans offered by Arkansas Blue Cross and Blue Shield or its national affiliate, the Blue Cross and Blue Shield Association.
According to Insurance Department filings, the premiums for those plans increased starting this month by about 8 percent to 9 percent, depending on the plan and coverage region.
The premiums for private-option plans offered by Little Rock-based QualChoice Health Insurance decreased, ranging from more than 20 percent less in the northeastern region to below 1 percent less in the northwestern region.
The premiums for St. Louis-based Centene Corp.’s private-option plans fell by 4 percent in the northwest region and by 2 percent in the west-central region. In the five other regions, the company’s premiums increased by 2 percent to 5 percent.
Centene, which markets plans under the name Ambetter Arkansas, is offering the cheapest private-option plan in each of the state’s coverage regions except the central region, where Arkansas Blue Cross and Blue has the cheapest plan.
Minnetonka, Minn.-based
UnitedHealth Group is offering plans on Arkansas’ exchange for the first time this year.
Including private-option plans, as well as others offered on the exchange, premiums are expected to increase an average of 4.4 percent this year compared with last year, according to the Insurance Department.
That includes an average increase of 7 percent for plans offered by Arkansas Blue Cross and Blue Shield or its national affiliate, an average increase of less than 1 percent for Centene plans and an average decrease of more than 8 percent for QualChoice plans.
The premiums for the private option make up a large part of the cost of the program, which is subject to a cap established in the federal waiver authorizing the program.
As long as the cost per enrollee over a three-year demonstration period stays below the cap, which will be calculated based on monthly targets, the federal government will pay the full cost of
the program. If the cost exceeds the cap, Arkansas will owe the difference to the federal government.
In November, the cost per enrollee was more than $16 below the target of $500.08. This year, the monthly target is $523.58.
Sanders said he expects the private option’s cost per enrollee to remain relatively flat this year compared with last year and for the overall cost to fall below the cap.
During the open enrollment period that began Nov. 1 and runs through Jan. 31, those who don’t qualify for Medicaid can enroll in any plan on the exchange.
The premiums for the plans are offset through federal tax credits for many people who don’t qualify for Medicaid and who have incomes of less than 400 percent of the poverty level: $47,080 for an individual, for example, or $97,000 for a family of four.
Those who qualify for the private option can enroll at any time throughout the year, but can change plans only during the open enrollment
period.
Andy May, a Newport insurance agent, said only a few of his 400 clients who are enrolled in private-option plans have asked him for help in switching plans during the enrollment period.
Enrollees don’t have much reason to shop around because the plans’ benefits are largely the same, he said.
“When you’re not paying anything — it can’t get much better than free,” he said.
Gov. Asa Hutchinson has said he will seek approval from the state Legislature and federal government for changes to the private option starting in 2017, when Arkansas will begin paying a portion of the cost.
Those changes include charging premiums to certain enrollees, requiring job training for the unemployed, and subsidizing coverage through employer-sponsored plans — instead of through the private option — for those who have access to job-based coverage.
A legislative task force endorsed Hutchinson’s plan last month.