ACA prices in Houston are starting to dip

Despite assault on health law, rate decline for 2020 plans seen as sign of stabilization

After years of eye-popping insurance rate increases, the price for most health plans offered in the Houston area through the Affordable Care Act are going down in 2020. Really.

Only one of the four insurers selling plans on the exchange in Harris County has asked regulators for a small rate increase. For the others the price drops aren’t huge — typically only about 1 to 2 percent — but still health economists see this long hoped-for development as a sign the individual market is stabilizing and insurers finally have a handle on how to price plans after complaining of losing money.

“That took some bumps along the road,” said Cynthia Cox, vice president at the Kaiser Family Foundation, a Washington health care research organization and think tank. She added the decreases may be corrections to steep price increases of recent years.

It is not such a distant memory when Blue Cross and Blue Shield of Texas, the state’s largest insurer, asked for a nearly 60 percent rate increase for its plans in 2017 before federal officials pared that to just under 50 percent. Similarly, Community Health Choice received a 49 percent rate increase a year later for its 2018 plans.

Now, both companies’ rates are dropping, in the case of Blue Cross and Blue Shield for the second year in a row. Blue Cross and Blue Shield has asked for an average rate decrease of just over 2 percent for its plans for 2020. Community Health Choice has asked for an average decrease of 1.6 percent for its plans.

Molina Healthcare, which also will be in the Houston market, has asked for a rate reduction of 3.2 percent and 2.1 percent for its plans. The only exception is Celtic Insurance Company, operating as Ambetter, which has asked for rate hikes ranging of 0.15 percent and 3.9 percent for the coming year.

Rate requests will be finalized by the federal Center for Medicare and Medicaid Services before enrollment opens Nov. 1. Individual plans are for those who do not get employer-sponsored health plans or government coverage.

Still, the storm clouds that have hung for nearly a decade over the law known as Obamacare have yet to clear. Politics and price have proven to be sturdy adversaries.

Many continue to struggle to afford plans even with rate declines, especially those who make too much money to qualify for the often significant premium reduc

tions through federal subsidies, health economists say.

Subsidy cliff

Gail Van Oosten

For the coming year, it’s unclear whether she will again qualify for a small group plan as her business partner is now eligible for Medicare.

“I’m still working, but I’m working just to pay for my health insurance,” she said Tuesday. “Our inability to retire is because we are one catastrophic medical bill away from bankruptcy.”

Van Oosten faces what health care analysts call the subsidy cliff, a flaw in the law that even proponents of the Affordable Care Act say is worrisome. Under the current calculation, once an individual or family hits a specific income they are abruptly cut off from subsidies. “If you make $1 too much suddenly insurance is unaffordable,” said Stacey Pogue, a senior health policy analyst at the Austinbased Center for Public Policy Priorities.

The uninsured rates for both the nation and Texas dropped steadily from 2013, when the Obamacare plans were first rolled out, until 2016, when the rate of uninsured dropped to historic lows. During those years, an estimated 18.5 million people nationally gained coverage. Then, in 2017, progress stalled and the uninsured rate began to tick up again.

This is especially troublesome in Texas, which has stubbornly held the top spot in the number and rate of uninsured in the nation. The number of uninsured Texans had dropped by more than 1 million under Obamacare — from 5.7 million in 2013 to 4.5 million in 2016. But then, in 2017, the state lost ground, increasing its number of uninsured by more than 270,000, according to U.S. Census figures.

It remains unclear why this happening, but speculation abounds, especially when politics enter the conversation.

Political lens

Critics of the law see proof of its unpopularity in the increase in the uninsured rate. “As President Trump predicted, people are fleeing the individual market,” Seema Verma, administrator of the Centers for Medicare and Medicaid Services said in a statement earlier this month. “Obamacare is failing the American people and the ongoing exodus of the unsubsidized population from the market proves that Obamacare’s sky-high premiums are unaffordable.”

But others marvel the market is remarkably stable, considering the ongoing efforts by the White House and Republicans in Congress to dismantle it.

“I’m surprised enrollment has remained as strong as it has,” said Vivian Ho, a health economist at Rice University’s Baker Institute of Public Policy. Figures from the Centers for Medicare and Medicaid Services show that only about 40,000 fewer Texans signed up for plans for this year over the previous one.

That, despite a steady stream of actions and trashtalking to undercut the law by the Trump administration. Those efforts have included numerous attempts to repeal it outright as well as legislation to erase the penalty for not having insurance, deep cuts in budgets to promote enrollment, and more recently, the unspooling of regulations that allow skimpy plans that offer less coverage and fewer protections to flourish.

Then came the lawsuit. Late last year, a federal judge in Texas ruled the entire law was unconstitutional .The decision is now pending before the United States Court of Appeals for the Fifth Circuit and will likely end up before the U.S. Supreme Court. If so, it would be the third time the law will be tested by the high court.

Mildred Phillips was highly skeptical of the ACA when she left her corporate job and the corporate health benefits that came with it to start a martial arts studio. She knew she needed health insurance and promised her friend from church she would at least listen to the pitch from an enrollment navigator at Change Happens, a Houston community-based nonprofit. She bought her first plan in late 2014 and has never looked back. Today, she has a plan with Ambetter that comes with a small subsidy.

“I’m 50 years old,” she said, “My health is very important to me.”

Joe Raedle / TNS Obamacare, passed in 2013, has been clouded by politics and skyrocketing pricing models. Last year, a federal judge in Texas ruled the entire law was unconstitutional.

Alex Brandon / Associated Press Premiums for most health plans offered through the Affordable Care Act are declining in Houston.