Blue Cross eyes major exit from individual market
MINNEAPOLIS (AP) — Minnesota’s largest health insurer will pull the bulk of its plans off the individual market at the end of the year, forcing an estimated 103,000 residents to find new health care plans and providing the latest reminder of volatility in the market that’s been reshaped by President Barack Obama’s health care law.
Blue Cross Blue Shield of Minnesota announced the decision late Thursday, citing heavy financial losses in that sector that showed no signs of reversing. Blue Cross will continue offering a separate plan that currently serves just 13,000 people via a subsidiary.
Minnesota’s individual market is designed for residents who aren’t covered through employers or public health care programs, allowing them to health care plans through brokers, Minnesota’s health insurance exchange or directly through the company. The 103,000 plans impacted are nearly a third of the state’s individual market.
“Shifts and changes in health plan participation and market segments have contributed to a volatile individual market, where costs and prices have been escalating at unprecedented levels,” the company said in a statement. “We understand and regret the difficulty we know this causes for some of our members.”
Roughly 5 percent of Minnesota residents buy coverage on the individual market, but that small slice has been disproportionately impacted by the health care overhaul law rolled out in 2014, which required all Americans to buy health insurance and banned insurance companies from excluding those with preexisting conditions. Insurers have struggled to accurately project medical costs, leading to major premium increases — Blue Cross hiked its prices by nearly 50 percent for 2016, leading the double-digit increases across the market in Minnesota.
Gov. Mark Dayton said his administration will help enrollees on lapsing plans find new coverage for 2017, cited the strides Minnesota has made in lowering the number of uninsured residents in recent years and stressed that the company’s departure “will not imperil that progress.”
“Blue Cross Blue Shield’s decision to leave the individual market is symptomatic of conditions in the national health insurance marketplace,” the Democratic governor said in a statement.
Minnesota Republicans saw the company’s planned exit as an example of the failings of the health care law.
“We were told ‘if you like your plan, you can keep it’ by President Obama and Democrat architects of MNsure here in Minnesota. Sadly, tens of thousands of families will once again be forced to pay more while finding new insurance, new clinics and new doctors,” said Rep. Greg Davids, a Preston Republican.
It’s yet another shake-up for MNsure following PreferredOne’s exit from the exchange in 2014, when the Golden Valley company had the largest share of enrollees. MNsure spokesman Shane Delaney said roughly 20,000 of its consumers are covered through Blue Cross and will need to select a new offering for next year.
Delaney said the exchange will work to coax those people back to MNsure, the sole resource for federal tax credits to offset premium costs that has struggled to capture a larger share of the individual market.
“This may be what it takes to shake them loose, so to speak, to come to us to take a look at their options,” he said of the 100,000 people who’ll need new insurance by 2017.
This story has been corrected to show that Blue Cross Blue Shield is pulling the majority of its plans off the individual market, but not all of them.