PHOENIX (AP) — Health insurance companies that sell individual policies on the federal marketplace in Arizona are seeking major premium increases for 2017 as they struggle to adjust to providing coverage under the Affordable Care Act.
The filings with the state Department of Insurance come from six big insurers who will sell policies next year. They seek average increases of 8.7 percent to as much as 65 percent. Blue Cross Blue Shield of Arizona, the state's largest insurer with 43 percent of the market and the only one serving all 15 counties, is seeking that large boost.
Blue Cross says it has lost $185 million on individual policies over the last two years. The company says in a statement that it's asking for higher rates because its costs have ballooned as previously uninsured patients buy coverage, prescription costs go up and people with significant health issues come into the system.
The rate increase filings don't include employer-provided group plans that insure a much large number of people.
The Department of Insurance will review the data behind the filings to determine if they are reasonable but can't reject the rate increases, spokesman Stephen Briggs said Thursday. Insurers could still change their actual premiums and plans in the coming two months. Open enrollment for 2017 begins Nov. 1.
The number of insurers in the state that sell marketplace policies is shrinking. UnitedHealthcare is pulling out of the Arizona market at the end of the year just two years after they jumped in. Also dropping out for 2017 is Humana Insurance. In January, the nonprofit insurer set up in the state as part of the Affordable Care Act, Meritus Health Partners, closed down because of financial difficulties. Its 59,000 customers had to find new policies.
Rural residents will see major changes in the number of available providers. This year, most rural counties had two or three different companies providing insurance. Next year, eight of 15 counties will have just one and five only two. Residents of Maricopa and Pima counties will see the most choice.
As of December, about 155,000 Arizonans had coverage through the marketplace, a signature part of President Barack Obama's health care overhaul law. As of March, the federal Centers for Medicare and Medicaid Services said 203,000 Arizonans had signed up for policies, but there's no way to determine how many of them have actually paid their premiums. The six insurers who filed for rate increases listed about 140,000 customers.
More than 12 million people nationwide get insurance from the marketplace. The coming year will be the fourth for the markets, and each year has seen dramatic shifts in Arizona's plans and premiums.
Last year, Arizona insurers sought average increases of 12 percent and some much more. According to the U.S. Department of Health and Human Services, people who received tax credits actually saw their premiums go down by 2 percent.
"Historically, the general rate increases represented by these filings are not an accurate statement of what really happens," said Allen Gjersvig, who oversees insurance enrollment services for the Arizona Alliance for Community Health Centers. For instance, as rates go up, so do tax subsidies that help about 75 percent of Arizona customers pay for their insurance. Also, people can easily shop around for cheaper plans on the marketplace website, making "switchers" more common.