Charleston Post and Courier
October 27, 2019
For the first time in four years the majority of South Carolinians who buy private health insurance through HealthCare.gov will get to pick which company they want to buy a plan from. It’s a major turnaround for a marketplace that not long ago was dominated by a single insurance giant.
Some people buying an Affordable Care Act plan for coverage in 2020 will have multiple choices. In Charleston County, for example, three health insurance companies will sell plans on the government’s website during open enrollment, which will run Nov. 1 to Dec. 15.
While the White House and Republican members of Congress have tried to dismantle the Affordable Care Act since President Donald Trump took office in 2017, South Carolina is seeing a strengthened market for these plans this year. HealthCare.gov rates in this state for 2020 plans also decreased slightly after years of consistent hikes.
Two new companies have joined the South Carolina market this year: Molina Healthcare and Bright Health. A third, Absolute Total Care, expanded to a dozen counties along the coast after selling plans just in Charleston County last year.
Ray Farmer, director of the S.C. Department of Insurance and a member of Gov. Henry McMaster’s Cabinet, said he has been thankful for the consistent presence of BlueCross BlueShield of South Carolina, the only company that has sold plans on HealthCare.gov every year.
But “the more competitors, the better choices our citizens have,” Farmer said. “This is certainly different and certainly a big step forward for us in South Carolina.”
Shifting markets
President Barack Obama signed the Affordable Care Act in the spring of 2010 and HealthCare.gov launched three years later.
That first year was “hectic,” said Ben Green, an independent broker with Columbia-based firm Insurance Advantage. Problems with a poor rollout of the government-run website were widely reported. But that year in South Carolina, five companies were selling insurance on the website. Consumers had options.
By the third year, Green said, BlueCross BlueShield of South Carolina was the only company selling on the exchange. Then President Donald Trump won the 2016 election.
During Trump’s first year in office, the administration pulled all federal dollars meant to help spread the word about open enrollment. Funding to health care navigators was slashed. And the president decided to cancel payments made by the federal government to insurance companies to help offset the cost of offering plans to low-income consumers.
Farmer told The Post and Courier in 2017 he worried “the market will implode” if Congress didn’t fund the reductions.
The market held steady.
Then a provision was baked into major tax reform passed by the Trump’s administration in late 2017 that nixed a fine for people who don’t buy health insurance. Many Democrats worried the absence of the individual mandate would mean many more people would forego buying coverage. Trump declared Obamacare “dead.”
Still, the number of people enrolled in South Carolina ticked up in 2018. It was one of only a handful of states that saw more participation.
While some prices for 2020 coverage have decreased for South Carolina customers, on the whole, insurance on HealthCare.gov is much more expensive now than it was when the marketplace launched in 2013. Department of Insurance estimates show that prices for some mid-level plans increased by more than $100 in recent years.
An improving economy and higher employment rates could be playing a role in people being able to afford to buy insurance, said Orgul Ozturk, a professor of economics at the University of South Carolina.
Still, signs for years pointed to an ailing marketplace, she said.
“It is kind of a puzzle in some ways,” Ozturk said. “If anything, we would have assumed it would have gone the other way.”
Green said signs of a stable market have attracted new insurance companies.
They’re seeing that BlueCross is making some money,” he said. “Enrollment went up last year. They’re seeing the market has stabilized.”
New entrants translated to rates decreasing this year for the first time since the law went into effect, according to the Insurance Department.
Insurers look at South Carolina’s growing enrollment through HealthCare.gov and see an opportunity to make money, said Frank Knapp, CEO of the S.C. Small Business Chamber of Commerce.
“Because those numbers are going up, everything is stabilized,” Knapp said. “Now there’s more opportunity for business.”
About 189,000 South Carolina residents — roughly 4 percent of the population — buy health insurance through the federal marketplace. Knapp said most of these citizens work for small employers.
That’s the case for Bennett Hart, who works for a craft beer distributor. He has been buying on the HealthCare.gov marketplace for several years.
Thirty-three and healthy, Hart said he needs coverage mostly for regular doctor visits and prescriptions. But he’s watched in frustration as the price of his BlueCross BlueShield of South Carolina plan increased.
“Each year I’m having to spend more and more money to keep the same mediocre benefits,” he said. “Insurance is more complicated than anything I deal with.”
Buyer beware
After a few years of being the sole insurer on the market, BlueCross BlueShield of South Carolina says it welcomes the competition.
“We believe our broad physician and hospital network; our choice of benefit options; and our multiyear market experience with the exchange population will be attractive to returning members and new customers,” spokeswoman Patti Embry-Tautenhan said in a statement.
Green, the Columbia-based broker, said BlueCross is the only insurance company with a comprehensive network.
“Beware of a cheap price,” he said. “Verify the networks.”
Unwittingly visit an out-of-network doctor and patients can be left with bills their insurance company won’t pay. The price can differ significantly, Ozturk said.
“It may potentially be a high financial burden,” she said.
Bright Health, for instance, is selling plans in Anderson, Greenville and Pickens counties, but the Upstate’s largest hospital system won’t be in-network. Prisma Health, which also operates more than a dozen hospitals in the Midlands and Upstate, won’t be in-network for Molina Healthcare, Bright Health or Absolute Total Care, a spokeswoman for the hospital said.
Gavin Barney, an agent with husband-and-wife team Lowcountry Health Brokers, said customers should check the company’s website for a list of in-network doctors before signing up. A low premium might not mean saving money on the whole year.
“Just because there’s more opportunity, I wouldn’t say it’s automatically a lot better,” Barney said.
Almost everyone receives a tax credit from the government to help pay for the insurance, Barney said. Those credits drove South Carolina’s average monthly premium from $669 to $116 last year, according to data from the federal government.
Hart, the beer distributor, does receive those credits. But he ran into his first costly health obstacle this year. He discovered he has genetic cholesterol problems. The medicine he needs is not covered by his insurance. It costs $300 per month — more than his premium.
For the moment, he’s taking samples of the medication and piecing together a strategy for the rest of the year.
When enrollment opens for 2020 coverage, he’ll be looking for a plan that covers his medication.