Star Tribune (Minneapolis, MN) May 14, 2018
May 15--Medica's
status as the last health plan selling coverage on government-run insurance
exchanges for Iowa and Nebraska helped the insurer double its individual market
enrollment for 2018.
In the market where
self-employed people under age 65 buy coverage, Medica saw enrollment grow to
196,479 people as of March across Minnesota and five other states where the
insurer sells the coverage. Last year, the comparable tally was about 91,000,
according to a Star Tribune analysis of regulatory filings.
Medica garnered
national attention last year when red ink pushed other insurers to exit the
Iowa and Nebraska markets, leaving the Minnetonka-based insurer as the only
option for individuals seeking coverage that complies with rules in the federal
Affordable Care Act (ACA).
"We do expect
our business in the individual market to return to profitability in 2018,"
said Geoff Bartsh, a Medica vice president, in a statement to the Star Tribune
on Monday. "It's early in the year, but it appears that approved rates for
2018 will cover the claims expenses across our service area."
The numbers only
apply to the individual market, a small slice of the health insurance world for
people who don't get coverage from an employer or a government program like
Medicare.
The federal health
law fundamentally changed the individual market by stopping carriers from
denying coverage to people with pre-existing conditions. The ACA also created
government-run insurance exchanges that were meant to make shopping easier for
consumers. The changes, which took effect in 2014, were seen as a chance for
new players to enter markets.
Medica has been
somewhat unusual in sticking with a strategy of growth via ACA markets, even as
some of the nation's largest carriers, including Minnetonka-based
UnitedHealthcare, have retreated from the exchanges.
"Since there
were a lot of exits there were lots of opportunities for remaining carriers to
pick up new members, whether they really wanted to or not," said Katherine
Hempstead, a researcher with the Robert Wood Johnson Foundation, in an e-mail.
For decades, Medica
has been known primarily as a Minnesota insurer, and the nonprofit still sees a
much bigger share of its revenue from employer groups and people with Medicare
coverage.
In the individual
market, the insurer now has more than 88,000 subscribers in Nebraska and 45,000
in Iowa, compared with roughly 39,000 in Minnesota.
In 2013, Medica had
about 49,000 individual market customers in Minnesota, which has seen an
overall decline in the individual market enrollment.
In Iowa and
Nebraska, many with individual market coverage have held onto pre-ACA health
plans that regulators have allowed to continue despite new rules under the
federal health law. In Kansas, Medica is one of three insurers selling
ACA-compliant coverage, Bartsh said, but the only carrier doing so on a
statewide basis.
In 2016, Medica
said it lost $55.8 million on $332.5 million of revenue in the individual
market. Last year, the insurer said its losses in the market narrowed to about
$4.8 million on $750.6 million in revenue. Medica also sells individual
policies in North Dakota and Wisconsin.
"Continued
instability in this market was recognized by state regulators, which allowed us
to set prices that aligned better with the health care needs of our
members," Medica said in a statement.
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