Some insurance rates up 49% on N.M. exchange

Concerns over federal action push record premium increases, state official says

State regulators have approved the largest health insurance premium increase in the four-year history of New Mexico’s subsidized exchange, Superintendent of Insurance John Franchini said Wednesday.

The costs for some plans are expected to rise by more than 40 percent.

The grim announcement from New Mexico’s top insurance regulator comes just a week after Franchini told The New

Mexican he expected the increase for consumers who buy individual insurance plans through the state’s online portal to be far more modest, between 17 percent and 20 percent.

On Wednesday, he said the recordsetting rate increases for 2018 were heavily influenced by uncertainty about whether the federal government will block or discontinue subsidies to insurers.

President Donald Trump repeatedly has threatened to halt cost-sharing payments to insurance companies in his drive to dismember former President Barack Obama’s health care law, the Affordable Care Act.

About 55,000 New Mexico residents sign up each year for federally subsidized insurance through the state’s exchange, known as beWellnm.

Average premium increases for 2018 will range from 36 percent to 41 percent for midlevel insurance coverage, according to an analysis by the Office of the Superintendent of Insurance. The full range of premium increases runs from 17 percent to just over 49 percent.

“This is the largest increase in the last four years,” Franchini said.

“Our actuaries — who are very, very conservative — have reviewed this and they don’t see any excess profit in these increases,” he added.

New Mexico remains among the 10 states with the lowest premiums in the country, Franchini said, and he emphasized that consumers should compare their current insurance policy with offerings from other companies on the exchange to conserve spending.

Rising rates among New Mexico’s four marketplace insurance providers appear to be outpacing the national average for individually purchased health insurance.

The Congressional Budget Office this month estimated average individually purchased premiums nationwide will grow by about 15 percent next year, in large part because of market nervousness over actions the Trump administration might take.

Still, the office expects more people nationwide will buy coverage through government-operated insurance exchanges in 2018, despite rising premiums and actions by the Trump administration such as cutting outreach programs.

About 60 percent of people who buy insurance through the New Mexico exchange qualify for subsidies that reduce costs.

“I feel sorry for the other 40 percent, though,” Franchini said. “Forty percent have to pay the full brunt of the rate increases.”

Franchini offered a more positive outlook last week, saying the state continues to have four insurance providers offering plans on the exchange for 2018 — Molina Healthcare, Blue Cross,

Christus Health Plan and Health Connections — the same as this year, signaling stability in New Mexico’s insurance market, even amid uncertainties in Washington.

“In essence,” he told The New Mexican, “New Mexico is getting more stable while the rest of the county is getting less stable.”

Cheryl Gardner, chief executive of the New Mexico Health Insurance Exchange, which manages the bewellnm.com portal and offers health insurance outreach around the state, also seemed optimistic last week, saying, “New Mexico is in a better spot than most states in the country.”

Franchini said Wednesday that rates are rising because not enough people are buying insurance through New Mexico’s federally subsidized marketplace.

Nationwide, the individual insurance plans offered through the exchanges typically have the most volatile rates in the insurance market.

Most patients in New Mexico receive health coverage through group plans, such as those offered by employers or through a retirement program, and any changes in those premiums are based on the cost of health care and prescription medications, as well as on the relative health and well being of those covered by the plan.

Widespread enrollment in Medicaid throughout New Mexico, a program that offers coverage for low-income people, also accounts for limited use of the state health exchange. An expansion in eligibility through the Affordable Care Act allowed nearly a quarter of a million new patients to enroll in the program.

But that program remains uncertain as Senate Republicans push a plan to end the expansion and cut funding for state Medicaid programs.