The only seller of individual health insurance policies under the Affordable Care Act in 13 rural Arizona counties said Tuesday that it won't raise premiums next year after all.
A Blue Cross Blue Shield of Arizona executive said the company will instead decrease rates by about 1 percent across all its individual plans in 2018. That's a change from an average 7.2 percent increase initially proposed in July.
Jeff Stelnik, the insurer's senior vice president of strategy, sales and marketing, told The Associated Press the change came because of improved profitability on current plans and an assumption that the federal government will continue funding a program reducing some customer costs.
The decision comes despite worries from many insurers that the "cost sharing reductions" they are required to offer many lower-income customers won't be funded by the Trump Administration.
"There still continues to be uncertainty in the marketplace, we still continue to be concerned by that uncertainty," Stelnik said. But he said a deadline for finalizing premiums for 2018 and a better balance between premiums and claims "enabled us to be confident in the new pricing that we are putting in the marketplace."
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Blue Cross sells individual marketplace plans in all but Maricopa and Pima County covering about 45,000 people. It also covers about 55,000 individuals with non-ACA plans that have different rates and timelines for premium increases.
About 90 percent of the people Blue Cross covers with its marketplace plans get tax credits to help offset their premiums. Rates vary by age, county, and coverage level, but a 40-year-old non-smoker living in Pinal County can get a benchmark silver plan for $577 a month before the tax credit.
Centene Corp. offers Health Net plan in those two counties and proposed a 5 percent increase in June. Its final pricing remains unclear, and a company official did not immediately respond to requests for its final rates. About 95,000 people buy marketplace plans with Health Net.
The decision by Blue Cross ends several years of steep price increases by insurers in Arizona that struggled to adjust to the new marketplace put in place by the Affordable Care Act.
Arizona had some of the lowest rates in the nation and robust competition from multiple insurers when the individual marketplaces launched for the 2014 coverage year. But insurers underpriced their plans and saw big losses, leading all but Blue Cross and Health Net to leave the state by this year and premiums to skyrocket.