New ACA insurers proposed
Two companies seek to enter Florida’s Affordable Care Act health insurance exchanges in 2020
Not only is Obamacare far from dead, it’s profitable and attracting more private insurance companies.
Two more companies are seeking to enter Florida’s Affordable Care Act health insurance exchanges in 2020, and unlike in previous years, returning companies are not seeking large premium hikes.
The new applicants are Bright Health Insurance Co. of Florida and Cigna Health and Life Insurance Co.
They’re likely sniffing opportunity in Florida, said Allan Baumgarten, an independent health market analyst who publishes Florida Health Market Review every two years.
In February, Florida had 1.67 million Obamacare enrollees — an increase of 73,329 over the previous year — while overall enrollment declined in the 38 other states that use the federal exchange. About 800,000 enrollees live in Broward, Miami-Dade and Palm Beach counties, according to data from the Centers for Medicare & Medicaid Services.
“I think they see Florida has been probably the poster child for enrollment in marketplace products and that companies like [Florida Blue] have been very successful,” Baumgarten said. “Maybe they think there’s a piece of that they’d like to keep for themselves.”
In all, 10 companies are seeking approval in Florida to offer products that meet the requirements of the Affordable Care Act, according to a statement by the Florida Office of Insurance Regulation.
Of them, nine companies want to sell on the federal exchange in Florida, which would make their plans eligible for financial assistance for low-income policyholders. Last year, seven companies were approved to sell on the exchange.
Returning companies are seeking rate increases that average 1.2 percent overall, according to state regulators. That’s far less than the 8.8 percent sought for 2019 and the 17.8 percent requested for 2018.
Insurers offering Obamacare plans enjoyed increased profits in 2018 and are continuing to make money so far in 2019 as costs have leveled off, according to a June 27 report by the Kaiser Family Foundation. The market has remained stable despite the Trump administration’s decision in 2017 to stop directly reimbursing insurers for cost sharing reductions and Congress’ elimination, effective this year, of the tax penalty for failing to carry insurance.
But uncertainty remains. All eyes are on the appeal of a December 2018 Texas district court ruling the entire Affordable Care Act is unconstitutional. If the ruling is not reversed, the law would be invalidated and the $55 billion in federal subsidies and tax credits that keep plans affordable for lowincome policyholders would likely disappear, Baumgarten said.
A final ruling likely won’t happen before 2020, meaning consumers will still be able to buy coverage for 2020 during the next open enrollment, which runs Nov. 1 to Dec. 15.
Florida is among seven states that Minnesota-based Bright Health, founded in 2016, wants to enter next year. Currently the company offers plans in just six states.
Bright Health is proposing to offer plans in Jacksonville, Pensacola, Orlando, Daytona Beach, Tampa and Palm Beach, but not Miami-Dade or Broward counties, according to a company spokesman.
He declined to say why MiamiDade and Broward were excluded from the company’s expansion plan.
Bright Health is a narrow network insurer, Baumgarten said. Narrow network insurers thrive by partnering with smaller provider networks to control costs and keep premiums affordable. The company has grown rapidly by limiting its offerings to individual plans and Medicare Advantage plans while avoiding the large