Exchange Plans Wait to Price 2018 Policies

It could be an another cold day in Chicago, as we wait to see what the Trump Administration decides to do with the healthcare subsidies. A glimmer of hope for some of those receiving subsidies.  The insurance companies are fearing for the worst. Brace for impact!

Health insurance companies must soon decide if they will participate in Affordable Care Act (ACA) marketplaces in 2018.  Some are sitting tight for the moment to see what the Trump Administration will say if they will continue to pay ACA subsidies. According to the WSJ, the industry is scheduled to meet with Administration officials on Tuesday. 

For the last couple of years, insurance companies have been hemorrhaging cash to keep up with the ACA.  Many have either exited the exchanges or closed up shop altogether.  Land of Lincoln Health is a prime example of this.  

Land of Lincoln Health was a program using tax dollars to increase competition with another insurance company in the Illinois market.  Land of Lincoln health was hardly known before the IL department of insurance had to shut them down in 2016. 

United Healthcare decided to sit on the sidelines for 2014 and came in the marketplace for exchange products in 2015.  They took on some heat with claims, and in 2016 they announced they would be pulling from the exchanges. 

Some areas around the country only have one insurance company to choose from the exchanges.  Having competition is healthy for consumers. Some of them are looking to exit, depending on what the Trump Administration decides to do about the subsidies. 

Health insurance subsidies part of the ACA is to help make health insurance more affordable to those who qualify. It’s based on a tax credit and not a discount.  The tax credit is advanced paid to the insurance company to reduce the premiums for those folks.  The policyholders use their projected income for the year to gain the tax credit/subsidy.  Then when they file their tax return, it is reconciled. 

In the next few weeks, we will see how much the current president is willing to step forward and nudge the law into collapse or try to fix it.  Their failure of the American Health Care Act, he continues to threaten to let the law explode.  For those insurance companies that stay for 2018 may have to raise their premiums sharply. Leaving more people to either drop their insurance or gain access to the tax credit to reduce their monthly premium going forward.  The coming weeks will tell.