Anthem to cut health plans

Insurer won’t sell on marketplace in state

Health insurer Anthem Blue Cross and Blue Shield says it will largely stop selling insurance plans in Wisconsin on the marketplaces set up through the Affordable Care Act next year, citing a volatile market for insurance plans that comply with the law.

Anthem will be the second large national insurance company to stop selling health plans on the state’s marketplaces. UnitedHealthcare pulled out last year.

But Wisconsin still will have one of the most competitive insurance markets in the country, in large part because of the number of regional insurance companies serving the state, many of them affiliated with nonprofit health systems.

About 14,000 people are covered by the Anthem health plans sold on Wisconsin’s marketplaces. That works out to less than 6% of the 242,863 people

who were enrolled in health plans sold on the marketplaces as of Jan. 31.

Anthem said its decision does not affect its health plans for employers, its Medicare Advantage plans or Medicaid plans.

It also will continue to renew its so-called transitional plans that were sold before March 2010 and December 2013. Those plans, which are not available to new customers, cover about 4,500 people in Wisconsin.

Anthem previously pulled out of the marketplaces for Milwaukee, Racine and Kenosha counties. But Molina Healthcare, Common Ground Healthcare Cooperative, Children’s Community Health Plan and Network Health sold plans in Milwaukee County this year.

Other health insurers selling marketplace plans in the state include Dean Health Plan, Unity Health Insurance, Security Health, Gundersen Health Plan and Aspirus Arise Health Plan of Wisconsin.

All of the insurers, though, have struggled.

“The Wisconsin individual market remains volatile, making planning and pricing for ACA-compliant health plans increasingly difficult,” Anthem said Wednesday in a statement.

Among the factors Anthem cited were a shrinking and deteriorating market and uncertainty at the federal level.

Health insurers in Wisconsin

must file their rates for next year in less than a month. But the Trump administration has yet to decide whether it will continue to fund the additional subsidies — known as costsharing reduction subsidies — available to people with low incomes.

The subsidies help offset deductibles and other out of pocket expenses for people with incomes below 250% of the federal poverty level — $30,150 for one person this year.

Here’s why that matters:

Health insurers would have to pay the subsidies even if they are not funded by the federal government.

That would force them to raise premiums — an increase that would affect people who don’t receive federal tax credits to subsidize the cost of health insurance.

In April, Anthem warned that it might pull out of the marketplaces if it didn’t know by early June whether the government would fund the costsharing subsidies next year.

Cathy Mahaffey, chief executive officer of Common Ground Healthcare Cooperative, was not surprised by Anthem’s decision.

“We know there is a lot of uncertainty in the market,” she said. “There is a crisis, and the crisis is now. We need changes.”

People who have bought insurance in the individual market overall are sicker and have higher costs than expected. As a result, health insurers overall have incurred large losses in that segment of their

business.

Although Anthem did not have a large market share in Wisconsin, it sold plans in 44 of the state’s 72 counties.

“They had some interesting plan designs, so there was a place for them,” said Chris McArdle, vice president of the Rauser Agency.

Anthem will offer health plans sold directly to individuals and families next year in Menominee County — a county with a population of about 4,500 and one of the poorest in the state.

The company has to continue to sell health insurance in one county or it will be prohibited from selling individual health plans in the state for five years.

The Anthem decision comes as Republicans in the Senate prepare to advance a plan to repeal Obamacare, and the health insurer’s move drew predictable reaction along partisan lines.

GOP lawmakers from Wisconsin said the Anthem announcement pointed up the failure of Obamacare and illustrated the urgency of passing a replacement bill.

“Obamacare is clearly collapsing, and we have to step in before more families get hurt,” House Speaker Paul Ryan (RWis.) said in a statement.

Democrats saw it differently.

“You can trace Anthem’s decision to the instability President Trump and Republicans in Congress have injected into the health care marketplace,” said Rep. Mark Pocan (D-Wis.).