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State’s 3 Biggest Insurers Project Rate Decreases On Individual Market

July 23, 2019

The three biggest health plans in Michigan’s individual market are projecting rate decreases on their health insurance plans in 2020, according to their proposed plans filed with the Michigan Department of Insurance and Financial Services (DIFS) Wednesday.

While the average rate change across all 11 plans that filed in the individual market amounts to a 2.5% increase, the three biggest plans by enrollment — Blue Care Network of Michigan (BCN), Priority Health and Blue Cross Blue Shield of Michigan (BCBSM) — are projecting rate decreases.

BCN — the health maintenance organization (HMO) of the Blues — is predicting a 1.2% rate decrease, and currently carries 157,381 enrollees. Priority Health, with 77,167 enrollees, is projecting a 0.1% decrease. BCBSM — the preferred provider organization (PPO) of the Blues — is projecting a 7.7% decrease and it has 50,604 enrollees.

With 332,893 total enrollees in the state’s individual market, those health plans make up about 85 percent of the total market.

Other plans projecting rate decreases include McLaren Health Plan (5.9%), Meridian Health Plan (3.6%), Molina Healthcare (8.8%) and Total Health Care USA (0.6%).

Dominick Pallone, executive director of the Michigan Association of Health Plans (MAHP), called the projected rate decreases a “positive thing for consumers,” and said it shows the health plans are doing what they can to keep premiums down despite the rising costs of pharmaceutical services and hospitalizations.

As to why rate decreases are happening, Pallone attributed it generally to the health plans better understanding the risks associated with their respective populations, and tailoring their network or benefit design to those members. He also said the “turmoil” in Washington, D.C. that was affecting rates in past years has simmered down.

In the small group insurance market – which includes plans offered through employers who employ anywhere between 2 and 50 employees – there’s an average 3.6% rate hike across the health plans that have filed for next year.

BCBSM, with 201,275 current enrollees in this market, is projecting a 3.7% hike in rates. BCN and its 98,176 enrollees could be looking at a 5% increase. Priority Health, with 50,612 enrollees in the small group market, is projecting a 0.8% decrease.

However, not a single health plan is offering a small group insurance plan on the federal insurance exchange for 2020, which Pallone said reflects that “nobody is participating any more” in the state’s federally-facilitated marketplace as called for in the Affordable Care Act (ACA).

In the individual market, there’s a projected 109 plans being offered on the state’s federal exchange, and nine of the 11 health plans are offering such options on the exchange – Alliance Health and Life Insurance Co. and Health Alliance Plan are the exceptions.

The nine health plans offering options on the individual market was why DIFS Director Anita Fox said Wednesday in a press release that the state’s marketplace “is continuing to thrive,” and added that some states “have as few as one or two options.”

The health plans’ rate filings are still subject to DIFS approval. The department is taking public comment on the rates up to July 26.

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