Annual US Health Insurance Market Update
I think it goes without saying that 2020 has been a QUITE different year than any of us could have imagined!
As we approach the ACA/Obamacare open enrollment period for 2021 individual health insurance and the annual renewal for the vast majority of small business group health plans, I am providing information regarding changes that are happening in the market in 2021 to help you get prepared to find the BEST possible health plan for your situation and needs.
I also know that if you are on an ACA/Obamacare individual plan you have already received your current plan’s renewal information for next year, so I hope this also provides some context to the planned rate increases or decreases, plan changes and cancellations, etc. that you are seeing.
Below you will find changes that are happening at both the federal level and links to more information in the states where US Insurance Solutions is currently licensed. Click the link for your home state to get more information about what is happening where you live.
Please review this information and then, if you haven’t already done so, go to my online calendar (and at the bottom of this page) and set an appointment for us to talk about your options for 2021.
At the time of this writing we are just days away from the 2020 elections. The results of the elections will determine the “direction” of the healthcare and health insurance industries for at least the next four years. That direction from the federal level will likely be completely different depending on who wins the Presidency and which party controls each chamber of Congress.
With that said, there are a couple issues in the news that I want to touch on here. Beyond the elections, these issues could have a significant impact on the future of both the healthcare and health insurance industries:
1. The Supreme Court will begin hearing oral arguments on November 10, 2020 in the case of Texas v United States. This case is a legal challenge against the Affordable Care Act (ACA/Obamacare). Previously a lower court ruled that the ACA’s Individual Mandate is unconstitutional. Simply put, the Supreme Court will need to decide if they agree that the Individual Mandate is unconstitutional and most importantly, if they do agree, they must decide if the mandate can be separated from the rest of the law without affecting the rest of the law, or as the plaintiff’s argue, that the entire law must be struck down because it cannot continue without the Individual Mandate.
From everything I have heard and read about the case, I believe that it is the weakest of all the challenges to the ACA to date. Therefore, even with the recent confirmation of Justice Coney Barrett, I would be EXTREMELY surprised if the Court ruled the mandate IS unconstitutional AND the entire law must be struck down as a result.
However, even if that does happen, please do not believe the political posturing that “20 million people are going to immediately lose their health insurance,” and that “people with pre-existing conditions will no longer be able to get health insurance.” Whatever the next health insurance law is, it WILL provide insurance coverage options for people with pre-existing conditions and lower incomes.
I will also add that it took almost four years from the date the Affordable Care Act was signed into law until it actually took effect. After 7 years under the law, it will take at least as long to unwind the ACA and implement something new.
2. The following is something that could have a more immediate effect on cost and accessibility of care for all healthcare consumers. As I mentioned in last year’s update, the Trump administration proposed rules that will require hospitals to disclose their negotiated rates with health insurers and further reduce rates for some doctor services. Those rules have been finalized. They have also been challenged in court and upheld. They are set to go into effect on January 1, 2021. Whether they do could be dependent on the results of the upcoming election.
In addition, on 10/29/2020 a final rule on transparency in coverage was released. This builds on the above rule related to hospitals by requiring most group health plans and health insurance issuers in the individual and group markets to disclose price and cost-sharing information for all covered items and services to participants and enrollees. These additional rules will begin to take effect 1/1/2022 and beyond.
I truly hope these rules do go into effect, because as I also said in last year’s update, the lack of price transparency and a TRUE “market” in healthcare is possibly the BIGGEST single problem with the US healthcare system!
NOTE: At US Insurance Solutions, we are not waiting for the above rules to take effect. We have created a long list of “free market” healthcare tools and resources to help you get the best value when you need care no matter what type of health insurance you have. Please visit our US Healthcare Resources page and take some time to educate yourself on how to be a better healthcare “consumer.”
With those two issues on the table, let me get into the health insurance market updates.
Alternative Health Plan Solutions Updates
In many states we are continuing to see expansion of CHOICES for U.S. individuals and small businesses than the one-size-fits-all ACA/Obamacare plans. There are MORE and BETTER affordable alternative plan options than there have been in years.
As I mentioned last year, here are some notable changes that have led to this expansion of alternative plan options (and how they have helped):
- The elimination of the federal tax penalty for not having an ACA/Obamacare “qualified” health plan. (Alternative plans are even more affordable, and people can buy more comprehensive coverage with the tax penalty money they don’t have to pay).
- Extending the duration of Short Term Medical plans up to 12 months with the ability to renew for up to a total of 36 months. (Provides a minimum of a full year of coverage. Extending up to 36 months provides longer term rate stability and coverage for pre-existing conditions after the first year).
- Health Reimbursement Arrangements (HRAs) as an alternative to a group health insurance plan. (Specifically, the Individual Coverage HRA (ICHRA) can be a more affordable way to offer benefits for businesses that can’t afford to offer a group health plan).
IMPORTANT NOTE: All non-ACA/Obamacare alternative plans are available year-round. For both individuals and small groups. There is NO limited (open enrollment) period for these options.
Health Insurance Buffet - Alternative Individual Plans
Primary (Main Course) plans - In addition to more and longer Short Term Medical*** plans, our two main Fixed Benefit plan companies, Philadelphia American and Manhattan Life have each made significant upgrades to their plans in many states.
***Article: Short-Term Health Beats Individual Major Medical
Supplemental (Side Dish) plans - We also have expanded plan offerings and enhancements to available accident, critical illness and hospital indemnity plans. You can see many of these on our US Supplemental Coverage page.
Your Health Insurance "Plate" - We always work to provide you with the most comprehensive coverage we can offer to fit in your budget. We do that by combining the available Primary and Supplemental plans in your state into the best available package.
***Article:Unsubsidized ACA exchange population declined by 45% over 4 years
As noted on our US Insurance Solutions home page, if you are looking for a better, more affordable individual/family health plan and make too much money to get a tax credit subsidy from the government, one of our NAHP alternative individual health plan solutions may be just what you need!
Alternative Small Group Health Plans
If you own (or work for) a small business with under 50 employees, and meet certain criteria, one of our NAHP alternative group health plans could be a better option than an ACA/Obamacare, fully insured group health plan.
Again, click on the link for your home state (below) to learn more about the alternative health plan changes and updates where you live.
On the other hand, for individuals who are eligible for a tax credit subsidy to help pay their premium and/or have significant health issues I can help find the best ACA/Obamacare individual plan. Also, for small businesses who don't have enough people for an alternative plan and/or have people with significant health issues in their group, I can help find the best fully insured ACA/Obamacare small group plan. Please review the following…
Federal ACA/Obamacare Changes
The following are some of the main changes happening with ACA/Obamacare plans.
Insurance companies entering or expanding in ACA/Obamacare individual markets:
Building on previous years, more insurers plan to enter new Obamacare markets for 2021. Here is information on several of the companies we represent:
Ambetter – In 2021 Ambetter is expanding to 400 new counties in 13 states where it already offers plans. They are also pushing into two new states — NM and MI. In total they will now be in 22 states.
NOTE: For the first time in 2021 we are now appointed to write Ambetter plans in ALL states where we are licensed and they offer plans!
Bright Health - Bright Health is expanding for 2021 to major cities in Florida, Illinois (Chicago), North Carolina, Ohio, Oklahoma and South Carolina, along with a statewide presence in both rural and urban counties in Nebraska. They will be available in the following states**: AZ, CO, FL, IL, NE, NC, OK, SC, and TN.
Cigna – In 2021 Cigna is adding 79 new counties. They will offer their plans in 220 counties in 10 states: AZ, CO, FL, IL, KS, MO, NC, TN, UT and VA.
Friday Health Plans – Friday will be expanding into NM, NV and TX for the first time in 2021. In Texas they are offering on-exchange ACA plans in Austin, DFW, El Paso, Houston, Lubbock and San Antonio. Friday Health offers competitive plans with unlimited $0 copay Telemedicine, $0 Primary Care visits and $0 mental health visits.
Medica – Please review the Medica 2021 Individual Market plans for updates on all states and plan changes.
Oscar Insurance Corp – In 2021 Oscar is expanding into NC, AR, OK, and IA. They are also expanding in FL to Martin, St. Lucie, Sarasota, Tallahassee, and Jacksonville. Their individual ACA plans will be available in the following states**: AZ, CA, CO, FL, GA, KS, IA, MI, MO, NJ, NC, OH, OK (OKC), TN, TX, and VA.
**Not all markets in all states
Changes to out of pocket limits and deductibles:
For the EIGHTH year in a row, the maximum deductible and out of pocket limits for Obamacare compliant plans are on the rise! The government sets a limit on how much these maximums can be. Family maximums can be twice as high as the maximum amount in a plan covering just one person (a “self-only plan”).
For 2021, the self-only maximum deductible and out of pocket limit can be up to $8,550 and the family maximum, up to $17,100. That is a 4.9% increase in out of pocket liability.
For high-deductible plans that are compatible with Health Savings Accounts (HSAs) they are lower with limits up to $7,000 for individuals and $14,000 for families. This is a 1.4% increase.
Lower rate increase percentages on individual plans around the country:
Continuing a trend over that past few years, average increases on individual ACA/Obamacare plans continue to lower than in the first 4 to 5 years of the law. As noted in this article: Average ACA plan premiums to drop by 2% in 2021 as more insurers join exchanges. As I noted above, the article states that on the Federal Marketplace, 22 more insurers will offer plans in 2021, bringing the total to 181.
As I mentioned in last year's update, insurance companies have figured out that rates are finally high enough, provider networks are nowSMALL enough AND deductibles and out of pocket limits are high enough (see above) that they can actually make money on individual ACA/Obamacare plans without the need for big rate increases. Some are even able to reduce their rates by small amounts.
Personal Note: While I would much rather see rate decreases or NO to very low increases in ACA/Obamacare plans, I believe we have reached a point where any positive news is (as the old saying goes), "like putting lipstick on a pig." No matter what you do to try to make it look pretty, it's still a PIG!
Small Group Plans –Better Than Last Year but Not Great
While it looks like there are more companies having small increases or small decreases in rates in the ACA/Obamacare small group market there are still many companies with rate increases near or over 10%. With a few targeted exceptions, you are also NOT seeing expansion of companies offering small group ACA/Obamacare plans.
The reason you are not seeing expansion is that while fully insured, small group health plans must comply with ALL the same ACA/Obamacare rules and coverage mandates as the individual plans, group plans typically still offer larger PPO networks, which are more costly to insurance companies.
The limited new entries in the small group market are including more limited EPO and/or HMO network plans, which are similar to the individual market. If/when we see the elimination of larger PPO network availability with small group plans, then we might start seeing more companies entering or re-entering the small group ACA/Obamacare markets.
In the State Changes section below I have outlined all the proposed rate changes I could find in your state for both individual and small group health insurers.
State by State Changes and Updates
As noted above, please click on the link for your state for more details on what is happening with both the Alternative Health Plans market and ACA/Obamacare plans where you live.
U.S. Insurance Solutions is here to help
Remember, you are NOT in this alone…I am here to help! As your Personal Health Insurance Advisor, my goal is to make your life easier by taking the hassle out of finding the right health plan for your situation and needs.
To discuss your health insurance options and make sure you have the best possible health plan for your situation, please go to the link above with the image that says CALL ME and schedule a call with me on a day and time that works for you, and I will call you to review your options.