What they’re thinking: ‘Huge state of change’ raises health care questions

Earlier this year, Wellmark Blue Cross and Blue Shield and Aetna - Iowa insurers selling individual health plans on and off the marketplace - announced they would withdraw from the exchange in 2018. The remaining statewide insurer, Minnesota-based Medica, still has not decided its 2018 plans but has indicated it could pull out as well.

With so much in flux, The Gazette spoke with Dan Walterman, director of the health division of Premier Investments of Iowa.

Q: So, what exactly is going on?

A: With the Affordable Care Act, we've seen drastically huge rate increases. Starting in January 2014, when new plans were available, literally overnight we saw rates that were 300 percent higher. Since then we've seen 500 to 1,000 percent rate increases.

Plans are much more expensive than they were before the ACA. What's happening now is that so many insurers are taking so many losses - it's an environment where they can't be profitable, so they are bailing out of the ACA. With ACA premiums increasing dramatically and the selections of insurers dropping dramatically - people can't afford to pay 25 to 50 percent rate increase - something needs to be done.

Q: How are you advising clients?

A: The thing we watch for is how to take advantage of the best opportunity for our customers. We have to realistically put politics behind us. What people need to understand, with all of the changes coming down, is that we don't know exactly what they are yet. With the Republican plan, it hasn't gone through the Senate yet. Once it does, it will change dramatically and the devil lies within the details. One thing I tell people is to not focus on the reports you see on social media.

Q: Are a lot of people concerned over the lack of options?

A: We are getting a lot of calls from people who are concerned about what will be left in 2018 - 71,000 people are losing their individual health insurance at the end of the year. We're not even sure if there will be an option left for ACA plans (if Medica drops out).

Unless something is passed to remedy the Affordable Care Act, everybody who loses their plans will have to go through underwriting because there is nothing left. Obviously we have a very broken system that needs to be fixed and it needs to be fixed soon.

Q: What do you think is contributing to some of the problems going on in Iowa's individual market?

A: A third of counties in the United States only have one insurance carrier in 2017, so the problems are certainly not restricted to Iowa. There are a number of counties with no insurance carrier. You look at other states ... Arizona saw a rate increase of 116 percent on average, Oklahoma had a 69 percent increase, Tennessee had a 63 percent increase, Pennsylvania had a 53 percent increase.

As far as rate increases, Iowa has been relatively low. But before the ACA, we had 11 different major insurance carriers. Starting Jan. 1, 2014, we only had four and those four have exchanged and traded off. CoOportunity Health was the very first taxpayer-backed health co-op to go bankrupt. ... UnitedHealthcare came in the next year but then left.

... One of our biggest issues is the reinsurance money that was supposed to help cover the large claims was never there. Insurers never saw that money and large claims were not covered, so insurance companies had to increase premiums even more. That's probably been the largest downfall of the whole thing. Insurers planned on having that money and at the end of the day that was not there - that's why we had huge rate increases. Insurers canceled plans or had to leave the business all together.

A: Any other advice?

A: We are in a huge state of change. Whether you like (the ACA) or not, something needs to happen. The ACA, as much as it helps people, is also hurting a lot of people. Somewhere we need to find a happy medium.

l Comments: (319) 398-8331; chelsea.keenan@thegazette.com