Rural Iowans face limited health-insurance choices

Iowans in 13 rural counties who want to buy subsidized health insurance under the Affordable Care Act will have just one option for 2017, the state insurance division reported Tuesday.

Medica, a relatively small carrier based in Minnesota, is the only health insurer that has agreed to sell individual policies in all of Iowa's 99 counties, via the Affordable Care Act’s online marketplace. The marketplace is the sole place where consumers can buy individual health insurance that qualifies for subsidies under the federal law, also known as Obamacare.

The Obamacare marketplace, also known as the exchange, was touted as a way to encourage competition among health insurers. It is designed for people who buy their own policies instead of obtaining them via an employer or a government program, such as Medicare or Medicaid. About 55,000 Iowans purchased individual health insurance policies for 2016 on the exchange. Most had incomes low enough to qualify for subsidies, which come as tax credits. 

In 2017, residents of some urban counties will have access to policies from as many as three health-insurance carriers on the exchange to choose from, the insurance division reported. For example, people living in the Des Moines, Cedar Rapids and Quad Cities areas will have access to policies through Aetna, Medica and Wellmark.

The counties with just one carrier — Medica — will be Adams, Buena Vista, Iowa, Jefferson, Keokuk, Lee, Louisa, Mahaska, Page, Pocahontas, Taylor, Van Buren and Wapello.

Insurance Commissioner Nick Gerhart urged consumers to shop around for coverage, if possible. “It’s important for Iowans to be sure they look at all factors such as cost — which includes whether they are eligible for a tax credit by purchasing through the marketplace; whether their preferred doctor is within that plan’s network; and the types of coverage and services offered under the different plans,” he wrote in a press release.

The insurance division also posted a list of sample premiums for various counties, to give consumers an idea of how much their insurance could cost next year. Exact 2017 rates and subsidy levels should be available on the Obamacare website, Healthcare.gov, when open enrollment begins on Nov. 1.

Gerhart said Tuesday he had worried that even more Iowa counties would be served by just a single carrier next year. Even if consumers have just one choice of carrier, he said, they still should be offered multiple plans with various premiums and coverage levels. “The best advice I can give is that people should still look for the best plan in those counties that fit their needs,” he wrote in an email to the Register.

Insurance companies’ participation in Iowa’s Obamacare exchange has been in flux since the system launched in 2013. One of the original participants, a new cooperative called CoOportunity Health, foundered in 2014. Tens of thousands of its customers had to scramble to sign on with new carriers.

Meanwhile, the state’s dominant health-insurance company, Wellmark Blue Cross & Blue Shield, declined to sell policies on the Obamacare marketplace. Wellmark finally agreed to sell policies there for 2017, but it will only offer them in 40 of the state’s 99 counties. Also, Wellmark will only sell marketplace policies that steer customers to use clinics and hospitals aligned either with the Mercy system based in Des Moines or with the University of Iowa system and related facilities in eastern Iowa.

Related: 

• Wellmark trims broad-network health insurance options
• Fewer Iowans lack insurance, Census report says

One of Wellmark’s primary rivals in Iowa, UnitedHealthcare, decided to stop selling policies on Iowa's Obamacare exchange beginning in 2017. But another big carrier, Aetna, agreed to continue selling individual health insurance in 76 Iowa counties. Aetna, which used to use sell Iowa policies under the Coventry brand, announced in August that it was pulling out of the exchanges in 11 states, but will continue to operate through the exchange in Iowa and three others.

The individual health-insurance market has been hit with much bigger premium increases than seen in the larger market for employer-provided coverage. Gerhart recently approved rate increases of 19 percent to 43 percent for more than 75,000 Iowans who buy their own policies. Many of those people will qualify for federal subsidies to help offset the cost, but some could be priced out of the market.

The insurers successfully argued they needed the premium increases to cover the unexpectedly high healthcare costs of previously uninsured Iowans. After approving the increases, Gerhart said thousands of Iowans could qualify for an exemption to the Obamacare requirement that most Americans have insurance. Under the law, people who can’t find a policy that costs less than 8 percent of their income can apply for the exemption.