BlueCross BlueShield of Tennessee announced Monday that it will be pulling its policies out of three of the state’s largest metropolitan areas for the 2017 Affordable Care Act Marketplace.
“BlueCross BlueShield of Tennessee has made the difficult but necessary decision to reduce our participation from eight to five regions on the Affordable Care Act (ACA) Marketplace in Tennessee for 2017,” the company said in a statement released Monday. “The change does not affect seniors with Medicare Advantage plans, those enrolled with BlueCare or anyone who has insurance through their employer.”
BlueCross BlueShield is the state’s largest insurer and according to reports provides insurance coverage to approximately 83 percent of Tennesseans on the individual marketplace.
The company’s decision to end sales of both on-Marketplace and off-Marketplace plans will affect an estimated 100,000 Tennesseans who reside in the Knoxville, Nashville, and Memphis regions. The Knoxville region includes several counties of Eastern Tennessee but according to information from BlueCross BlueShield residents of the Northeast Tennessee area will not be affected by the decision to end plan offerings.
“We will continue selling Individual/Marketplace plans in the five ACA regions where options from other insurers haven’t been readily available,” the statement from BlueCross BlueShield said.
For those regions of the state where BlueCross BlueShield will be continuing coverage, the company said it plans to offer four plan types: one bronze, two silver and one gold, al of which will feature “Network S” which the company identified as it’s most popular network. The company said “Network E” will no longer be available as part of a plan in any region of Tennessee.
“We have tried to make the ACA Marketplace model work for Tennessee, but we believe there are too many uncertainties to continue participating on a statewide level as we have before,” BlueCross BlueShield said in the statement. “We’ve made this difficult decision carefully, with the intention Tennesseans in every Marketplace region will still have an option for individual coverage under the ACA.”
BlueCross BlueShield was one of the first insurance companies to commit to participating in the ACA Marketplace and has been the only insurance provider to offer insurance plans in every region of the state since 2014.
“We have experienced losses approaching $500 million over the course of three years on ACA plans, which is unsustainable,” the company said in the statement. “Beyond closing the gap between rates and medical costs, we continue to have concerns about uncertainties with the ACA at the federal level that could lead to future losses. As a result, we’ve made this decision to scale back in an effort to limit the risk of losses and protect the financial security our more than 3 million members rely on.”
BlueCross BlueShield said it will continue to evaluate insurance performance on the Marketplace and could return to areas it has pull out of in the future if conditions improve.
The announcement on Monday was discussed by many law makers on both the state and federal level.
“Blue Cross’s decision is the latest canary in the coalmine. This is the collapse of coverage Commissioner (Julie) McPeak warned about last month,” said State Senate Majority Leader Mark Norris (R-Collierville). “This is the legacy of Obamacare – failure and collapse. When the Blues quit coverage, it should tell you something.”
Norris pointed to BlueCross BlueShield’s decision to pull out of the Marketplace as proof state legislators were right to be hesitant to expand the state’s Medicaid program on federal assurances.
“Now others see more clearly why Medicaid expansion in Tennessee was always an intolerable risk. The uncertainty of an unreliable federal government puts Tennesseans unreasonably at risk,” Norris said. “This is just the next chapter. Uncle Sam failed to keep his commitment earlier this year which caused the Obamacare co-ops to fail in January. Now the exchanges are in grave jeopardy.”
“The collapse of the co-ops was a harbinger of things to come. During her testimony before the Senate in January, the Commissioner of Insurance blamed it on the fed’s failure to keep its commitment. It was true then. It is true now,” he added. “My main concern right now is for the folks who must now find coverage where it may cost too much or may not exist at all.”
While the company estimated the number of its customers that will be affected as around 100,000, U.S. Sen. Lamar Alexander, who serves as Chairman of the Senate Health Committee, said that number is more than 131,000 Tennesseans who will be affected.
“More than 131,000 Tennesseans who buy their insurance on the Obamacare exchange will lose their current insurance policy and have to scramble to find another policy,” Alexander said. “This is more evidence that Obamacare is falling apart. Short term, we need to give families the opportunity to use their Obamacare subsidies to buy a policy for 2017 outside of the exchange. Longer term, regardless of who the new president is, we need to replace Obamacare with insurance choices that allow Tennesseans to select low-cost insurance that fits their budget and their health care needs.”
U.S. Rep. Phil Roe, who serves as Co-Chairman of the House Doctors’ Caucus, also expressed his worry for how this will affect his constituents.
“This is deeply troubling news, and — on top of BlueCross’ proposed 62% rate increase for 2017 — the latest sign that the Affordable Care Act is in need of wholesale reform,” Roe said. “At the end of the day, many Tennesseans are worse off, not better, than they were before Obamacare. Today’s news further proves that fact.”
“As a physician, I believe every Tennessean should have access to quality, affordable health care, but Tennesseans are quickly getting priced out under the ACA – if they can find insurance at all. We can do better, which is why I support House Republicans’ Better Way agenda,” he added. “This agenda includes at least 48 ideas for health care reform, and will lower costs and return decision-making power to patients and their doctors. I’m also glad the proposal includes several provisions from the American Health Care Reform Act, the bill I drafted to repeal and replace Obamacare. I will continue to push for commonsense health care reforms that will make coverage affordable and accessible for Tennesseans, and — in the meantime — will work to find a solution for those affected by this announcement.”