Medica, UnitedHealthcare will join Coventry Health Care

Wellmark Blue Cross and Blue Shield may have opted out of joining the state exchange this week but two other health care providers announced they will be expanding into Iowa.

Minnetonka, Minn.-based Medica Insure will sell Affordable Care Act (ACA) health plans statewide and Minneapolis-based UnitedHealthcare will sell plans in portions of the state during the 2016 open enrollment season, which will take place this fall.

Only plans sold on the exchange are eligible for federal health care subsidies.

Iowa Insurance Division Commissioner Nick Gearhart said Thursday that the state will have an official announcement on Friday detailing all the carriers who will join the exchange and what counties they will serve. 'We wanted to expand our footprint,” said Dannette Coleman, senior vice president and general manager, individual and family business for Medica, a not-for-profit health insurance company that has about 1.5 million customers in Minnesota, North Dakota, South Dakota and Wisconsin.

'Iowa feels like a good fit from a cultural and business standpoint.”

Coleman said the departure from the marketplace of CoOportunity Health, the not-for-profit health care group that was taken over and liquidated by the Iowa Insurance Division early in 2015, created a big opportunity.

She pointed to a Kaiser Family Foundation study that shows only 20 percent of the eligible marketplace population enrolled in a plan on the exchange - the lowest in the country.

'We plan to provide products across the state and have a broad network,” she said, adding the group has partnered with Midlands Choice to establish a network of providers. Midlands Choice, which also worked with CoOportunity Health, is a regional preferred provider organization - meaning it contracts with physicians and hospitals to create a network.

Coleman said Medica plans to establish a long-term relationship with Iowa as well as create additional partnerships similar to what it has with the Mayo Clinic. The insurer provides travel, lodging and meal stipends for a patient who receives care at the Mayo Clinic, based in Rochester, Minn. The funding also extends to a companion that can travel to treatment with the patient.

She said there's a good deal of work to be done in Iowa before the 2016 open enrollment season, including a branding and marketing push to familiarize Iowans with the group.

'We plan to be traveling to Iowa a lot,” she said. 'We don't expect people to really know who we are.”

United Healthcare is an operating division of UnitedHealth Group, the largest single health carrier in the country, which provides coverage to 70 million people.

Competition

After CoOportunity Health's collapse, Coventry Health Care - a division of the nation's third-largest carrier Aetna Inc. - became the only insurer offering subsidy-eligible health care plans on the state exchange.

Wellmark, the state's dominant insurer, has been cautious to join the exchange and announced Monday it would remain off the marketplace for a third year in a row.

'Wellmark believes they are better off with the risk they know,” said Pete Damiano, director of the Public Policy Center at the University of Iowa.

The addition of two new insurers should mean good news for Iowa consumers, he said, but it's still early to know for sure.

'But the whole premise of the exchange is based on competition and providing options based on cost and provider networks, which should give people more options,” he said.

Wellmark also on Monday announced it will increase rates by 26 percent to 28 percent in 2016 for about 30,000 Iowa customers who purchased Wellmark plans under the ACA. That group tends to have higher health care costs, the company said.