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Eight insurers seek to participate in Pa. health exchange

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Thursday, Aug. 1, 2013, 10:45 a.m.
 

Uninsured Pennsylvanians who will be required to buy health coverage for the first time are likely to find plenty of options this year when they go shopping in a virtual marketplace being set up by the federal government.

Eight insurance companies are seeking to sell multiple health plans to individuals in the marketplace, known as a health insurance exchange, which will start open enrollment on Oct. 1. A list of companies was released on Thursday by the state Insurance Department, which reviewed the plans.

Final approval is still needed from the federal Health and Human Services Department, which is overseeing implementation of the Affordable Care Act.

The exchanges are being formed as a safety net to provide health insurance coverage for individuals whose employers are not required to provide coverage under the Affordable Care Act or who lack coverage because they are self-employed or unemployed.

Starting Jan. 1, the law requires virtually all Americans to have health insurance or face a penalty. To make coverage more affordable, federal subsidies will be available to buyers with lower incomes who purchase through a state exchange, which is expected to be similar to an online store.

In Pennsylvania, an estimated 1.2 million people are uninsured, and more than 90 percent are expected to qualify for subsidies, according to Health and Human Services.

The federal government is setting up the state's exchange because Gov. Tom Corbett, a Republican and opponent of the Affordable Care Act, decided not to have the state establish its own.

With eight companies, each offering multiple choices, Pennsylvania's exchange “looks to have at least as much competition and choice as most other states are seeing,” said Larry Levitt, senior vice president at the Kaiser Family Foundation, a California nonprofit organization that researches health care issues.

“It looks like insurers are finding this an attractive market,” Levitt said of Pennsylvania. “There's a sufficient level of interest here to indicate that they're not scared of this market, that they're looking to be competitive.”

Highmark, the state's largest health insurer, and the state's three other nonprofit Blue Cross companies want to sell health plans in the exchange. The other Blue Cross companies are Capital Blue Cross, which covers the central part of the state, Philadelphia-based Independence Blue Cross, and Blue Cross of Northeastern Pennsylvania.

The list includes two large hospital systems, UPMC and Geisinger Health System, as well as two for-profit insurers, Aetna Inc. and HealthAmerica, a subsidiary of Coventry Health Care, which was acquired by Aetna in May.

Five states and the District of Columbia have released information on health insurers and plans that will participate in their exchanges, according to ValuePenguin, a New York research firm. Ohio has the highest number of companies with 14. Washington, D.C., has the fewest, at 4.

The information provided by the state did not include specific information on what plans will be offered or how much they will cost.

And not all insurers will offer plans in every part of the state, said Jonathan Wu, chief analyst at ValuePenguin.

While Aetna and HealthAmerica will likely offer plans across the state, the Blue Cross companies each have their own service areas and are not likely to sell outside those areas, he said. Same with UPMC Health Plan, which mainly operates in Western Pennsylvania, and Geisinger, which is based in Montour County.

For Pittsburgh consumers, the likely options will be plans from Highmark, UPMC Health Plan, Aetna and HealthAmerica. Missing from the list are two for-profit insurers, United Healthcare and Cigna Corp., that have said they would not participate in the state's exchange.

United, which sells individual health plans in the state, has said it will continue offering individual products outside the exchange but is focusing on small and large group customers.

“United Healthcare evaluates each exchange opportunity individually, starting with our ability to honor our commitments to our existing local customers, members, and care providers,” spokeswoman Mary McElrath-Jones has said.

United has said it plans to pull out of California's individual insurance market, which is dominated by Anthem Blue Cross Blue Shield of California and Kaiser Permanente, at the end of this year.

Cigna Corp., which provides coverage for large employers in Western Pennsylvania, does not sell individual plans in Pennsylvania and is moving cautiously, spokeswoman Amy Turkington said. The insurer is pursuing exchanges in only five states, she said.

Alex Nixon is a staff writer for Trib Total Media. He can be reached at 412-320-7928 or anixon@tribweb.com.

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