The Arkansas Insurance Department has approved rate increases ranging from 7.8 percent to 9.9 percent for the plans that will be offered on the state's health insurance exchange next year, a department spokesman said Friday.
Also on Friday, the department published information on insurers' requests for increases that would go into effect if the federal government stops providing them with subsidies that help pay the cost of coverage for some low-income consumers.
Arkansas Blue Cross and Blue Shield, the state's largest health insurer, has requested an increase of 14.2 percent for its plans covering more than 202,000 Arkansans if the subsidies, known as cost-sharing reduction payments, are not provided, compared to an increase of 7.8 percent if the subsidies continue.
St. Louis-based Centene, which has plans covering more than 93,000 Arkansans, has requested an increase of 21.4 percent if the subsidies stop, compared with a 9.9 percent increase if the payments continue.
Little Rock-based QualChoice Health Insurance, which has exchange plans covering about 41,000 Arkansans, has requested an increase of about 25 percent if the subsidies are ended or 9 percent if they continue.
The 9 percent request was submitted Aug. 2, after QualChoice initially asked for an increase of 22 percent even if the federal subsidies continue.
The approved rates for Blue Cross and Centene that assume the cost-sharing payments will continue are the same rates requested in the companies' initial filings that the Insurance Department announced along with QualChoice's on July 26.
The Insurance Department submitted the approved rates to the federal Centers for Medicare and Medicaid Services on Aug. 18 for federal authorization, department spokesman Ryan James said.
The Insurance Department is still reviewing the alternative requests, submitted by the companies on Aug. 21, for increases that would kick in if the payments stop, he said.
The rate increases would affect plans covering more than 280,000 Medicaid recipients under the Arkansas Works program as well as those purchased on or outside of the exchange by people who buy coverage on their own, rather than through an employer.
Under the 2010 Patient Protection and Affordable Care Act, the federal government provides tax credit subsidies that lower the premiums for many consumers who don't qualify for Medicaid, buy coverage through insurance exchanges and have incomes below 400 percent of the poverty level: $47,520 for an individual, for instance, or $97,000 for a family of four.
The cost-sharing reduction payments reimburse insurers for increasing the amount of coverage such plans provide for consumers with incomes below 250 percent of the poverty level.
Ruling in a lawsuit filed by Republicans in the House of Representatives, a federal judge has said that the cost-sharing payments were never authorized by Congress, but the judge has allowed the payments to continue while the case is on appeal.
President Donald Trump has said he might stop the payments. His administration hasn't said whether it plans to continue pursuing the appeal.
James said the insurers' higher rate requests will be substituted for the lower ones if the cost-sharing payments stop before Oct. 6. Open enrollment on the exchange begins Nov. 1. The increases will take effect Jan. 1.
The loss of the federal-cost sharing subsidies wouldn't affect what insurers receive for covering Arkansas Works enrollees. That's because the state Medicaid program, instead of the U.S. Department of Health and Human Services, pays the premiums and provides the cost-sharing payments.
But the insurers would not receive the subsidies for those who don't qualify for Medicaid.
Gov. Asa Hutchinson has credited Arkansas Works with helping to hold down the premiums for plans on the state's exchange.
Hutchinson spokesman J.R. Davis said Friday that he didn't know whether Hutchinson supports continuing the federal cost-sharing payments, but he noted that the loss of the subsidies would have a "tremendous impact" on the rates for the exchange plans.
He said the insurers' approved rates "show that Arkansas is in a better position than other states, but there's more to be done."
"We're going to continue to look for ways to keep those rates low and to continue our reform efforts" to reduce the cost of the state's Medicaid program, Davis said.
A Section on 09/02/2017