Health insurers are offering consumers advice on how to control their insurance premium costs during the impending open-enrollment period.
The guidance is timely: As in many recent years, premium increases far in excess of the inflation rate are coming Jan. 1 from most insurers.
Open enrollment started Oct. 15 for Medicare patients and begin Nov. 1 for others. This period allows people the chance to pick a health insurance plan with a more affordable cost and coverage details more closely matched to their needs.
It comes this year amid renewed threats to eliminate or undercut the federal Affordable Care Act. Obamacare, as it is popularly known, brought sweeping changes to the health insurance industry, and it has been continually targeted by Republicans, from when it became law in 2010 right up through an executive orders last week by President Trump targeting key provisions and subsidies.
Kelly Smith, vice president of sales at Schenectady-based MVP Health Care, said New York consumers should not be overly alarmed by the maneuvering in Washington. If Obamacare is altered or eliminated, the changes wouldn’t take effect a week later, she said. And the impact would be muted in New York, she added, because it’s a heavily regulated state with many of its own provisions.
THE DOLLAR FIGURES
Four health insurers with large presences in the Capital Region -- MVP, Albany-based CDPHP, Latham-based BlueShield of Northeastern New York, and Fidelis Care, which has a regional office in Latham -- all have been approved by the state Department of Financial Services for premium increases to take effect Jan. 1.
For individual, small-market and large-group plans, the 2018 increases range from:
- 8.6 percent to 17.2 percent for BlueShield
- 4.9 percent to 20.4 percent for CDPHP
- 7.3 percent to 14.4 percent for MVP
- 10.2 percent for Fidelis (individual only)
By contrast, the U.S. consumer price index -- the price of an assortment of goods in services in metropolitan areas that are home to 89 percent of Americans -- increased 1.3 percent in 2016 and is up 2.2 percent for the 12 months ended in September.
This gaping disconnect between the health insurance market and the general inflation rate has existed for years.
For 2017, 2016 and 2015, CDPHP boosted its large group rates 5.6, 4.9 and 7.5 percent and its small group rates 9.5, 16.6 and 7.5 percent. MVP boosted its large group rates 9.7, 3.1 and 7.1 percent and its small group rates 6.7, 15.9 and 12.7 percent.
The CPI, by contrast, rose 2.1, 1.5, 1.6, 0.1 and 1.3 percent in the years 2012 through 2016.
(Other types of health plans offered by these insurers -- Medicare, Medicaid and Children's Health plans, for example -- operate under different regulatory structures and their premium increases are not directly comparable.)
Smith said the cost of health insurance is rising with the cost of health care, particularly medication. A huge portion of MVP’s reimbursements goes to specialty medication, she said, citing as an example a new drug that effectively treats hepatitis C.
“Which is great,” she said. “Hep C is a horrible disease, debilitative, but the drug cost is about $90,000 per treatment.”
CDPHP spokeswoman Ali Skinner cited medication and regulation for the price increases.
“The drivers continue to be rising drug costs, hospital consolidation, and taxes, fees and government mandates,” she said via email.
So what’s the consumer to do?
The traditional way to control insurance premiums has been to raise co-payments (amount of bill paid by patient) and/or deductibles (cumulative sum of bills the consumer must pay before the insurer starts paying).
“Everyone every year is looking to either cap costs or reduce out-of-pocket costs,” Smith said. “The trends are that more and more consumers, more and more employers are going to high-deductible plans.”
This is fine for people who are healthy or don’t incur a lot of medical expenses, but it can cause a financial crisis for those who need extensive or expensive care.
New at MVP for 2018 are a group of “first-dollar” plans, policies under which the most commonly used services, primary care visits and prescription drugs for example, are exempt from the deductible requirement. Also included is telemedicine, which MVP and many other entities are trying to encourage use of, due to its cost and time savings.
“We’re finding that employers that adopt it have a very high satisfaction rate,” Smith said. The sticking point is getting those first few people in a workplace to experiment with talking to a doctor by phone or video conference, rather than being examined and interviewed in person. Once they do, Smith said, word spreads through the office about the convenience of telemedicine, and more employees in that workplace give it a try.
Skinner said CDPHP has a suite of tools to help its members cut their costs, including:
- A price transparency service that lets members of high-deductible plans shop and compare prices for a variety of health care services.
- One-on-one meetings with a staff pharmacist who can review their medications and suggest lower-cost alternatives.
- Lower premiums for members using CDPHP’s Enhanced Primary Care program, under which doctors are paid not by the number of patients they see but by the results they achieve.
- Its Health Equity HSA, a health savings account that is linked seamlessly to CDPHP’s claims process.
Kyle Rogers, a spokesman for BlueShield NENY parent HealthNow NY, said preventative steps are important in reducing health care costs. BlueShield offers members many such services for free. It also offers gym memberships to senior citizens who hold its health policies.
WHAT TO LOOK FOR
As the open enrollment period begins, Rogers suggested that consumers look at what their current insurance offers and look at whether that matches up with what they really need. He said consumers should not hesitate to ask for help with what isn’t clear to them.
“It can be overwhelming, for sure,” he said. “It’s really important to do the research now, and understand the plan now.”
BlueShield NENY conducts community meetings for this purpose.
Skinner at CDPHP said consumers should look at more than dollar signs.
“Consumers need to know that cost is important, but it’s not the only factor to consider when shopping for coverage,” she said. “And, you get what you pay for. Consumers should look for health plan quality ratings.”
In the last two months, CDPHP has announced top ratings awarded to it by the National Committee for Quality Assurance, J.D. Power and the federal Centers for Medicare & Medicaid Services.
Smith at MVP urged consumers to look at the details of coverage.
“You really need to be an educated consumer on health care these days,” she said. “Look at your medical needs, what you paid out of pocket, what your premium is.”
She offered three key considerations:
- Understand what the insurance carrier offers and what differentiates it from its competitors. (Among other things, MVP emphasizes that it is local, with health directors in each region of its service area.)
- Check which providers are in the network, and decide if you can move away from a doctor who isn’t in the network. (This can be a particularly hard decision for parents of small children who like their pediatrician, or for anyone who’s been with the same primary care physician a long time.)
- Check the out-of-pocket costs for any expensive medications that are needed regularly.
“As you move to different stages in life or different stages in health care, people need to be educated,” Smith said.
The advent of online insurance shopping has greatly eased the process of picking the most appropriate plan, she said, and made it easier to see whether a bronze or silver plan would be sufficient instead of the more expensive gold or platinum.
“Before transparency tools, comparison tools, a lot of people were overinsured,” Smith said. “Some of these plans that are lower-cost plans are more effective, a better value.”