BlueCross to restore individual coverage in Knoxville market
Improved results this year allow insurer to expand coverage in 2018
Tennessee’s biggest health insurer will restore individual health insurance coverage to the Knoxville market next year, helping ensure 16 East Tennessee counties aren’t left without an individual insurance provider next year following Humana’s exit from that market.
BlueCross BlueShield of Tennessee, which withdrew its individual coverage under the health care exchange market in 2017 in Tennessee’s three biggest markets, said Tuesday it will resume selling individual insurance plans under the exchange market in the Knoxville area to ensure no market in Tennessee is left without coverage under the ObamaCare health exchange market.
But the Chattanooga-based health insurer also said it will not offer individual plans in the exchange marketplace next year in either Memphis or Nashville and it could change its mind this fall about Knoxville if Congress writes a more adverse law for health exchange markets.
In a letter to state insurance regulators, BlueCross President J.D. Hickey said BlueCross is showing
improved results in the individual health exchange marketplace this year after suffering more than $400 million in losses in such markets during the first three years of Obamacare.
“Though still very early, our 2017 performance has improved due to a combination of better claims experience and a more sustainable rate structure based on the medical needs of the members we’re serving,” Hickey said in a letter to the Tennessee Department of Commerce and Insurance. “With this in mind, I want to confirm that BlueCross is willing to serve the Knoxville region in the 2018 individual marketplace.”
State regulators welcomed the decision by BlueCross to ensure the Knoxville market has at least one provider of individual plans under the exchange markets.
“This is very much a glimmer of hope for those on the individual exchange in the Knoxville area so that they will have an option for coverage using their tax subsidies and tax credits for 2018,” said Julie Mix McPeak, commissioner of
Tennessee’s Department of Commerce and Insurance.
Hickey said the decision to return to the Knoxville market “is in no way a political decision nor is it a reflection of our perspective on the stability of the individual marketplace overall.”
U.S. Sen. Lamar Alexander, chairman of the Senate health committee and one of those working to come up with a GOP plan in the Senate to repeal and replace Obamacare, said BlueCross’s decision is helpful but still short of solving the problem of rising costs and limited competition in the individual market.
“This is welcome news that should give some peace of mind to 34,000 residents
in the Knoxville area that they may be able to use their subsidies to buy insurance next year,” Alexander said in a statement Tuesday. “But if BlueCross BlueShield of Tennessee does ultimately offer plans next year it is only a temporary solution — premiums and copays will be higher and there’s no guarantee there will be insurance in the marketplace in 2019, 2020 and beyond.”
The BlueCross CEO said based on current political uncertainty about health care reform, there is a lot of uncertainty about the future of the health exchange. But BlueCross has managed to cut its losses in 2017 after it raised average premiums in the individual exchange market by an average 62 percent in 2017 in the 65 counties where it now offers individual plans, including the Chattanooga area.
BlueCross has more than doubled its rates under Obamacare since the program began and, after initially serving all areas of the state, BlueCross will continue to limit where it offers individual coverage next year.
“With our past losses and the continued uncertainties associated with the individual marketplace, we are not willing to consider expanding our current footprint in 2018 beyond the addition of the Knoxville region, as the other geographies are currently covered by other carriers,” Hickey said. “We believe this fiscally conservative approach to limit our risk profile in this market continues to be in the best interest of all the members BlueCross serves across all lines of our business.”
Unless new insurers enter the Tennessee market, BlueCross will be the only insurer next year in 73 of Tennessee’s 95 counties.
Contact Dave Flessner at dflessner@timesfreepress.com or at 423-757-6340.