Wellmark again declines to participate in Affordable Care Act marketplace

Iowa's dominant health insurer announced Friday that it will not take part in the Affordable Care Act's federal marketplace for a second consecutive year.

Wellmark Blue Cross and Blue Shield made the announcement as it also disclosed plans to increase rates for individual and small group policyholders.

In a news release, the company explained its decision not to take part, citing the prospect of a state- or regional-based exchange as well as continuing problems with the federal marketplace, in addition to other factors.

'Every company determines where to sell their products, and we made this decision considering a number of variables,' said Laura Jackson, Wellmark's executive vice president for health care innovation and business development. 'We looked at factors like the probability of a state- or regional-based exchange and the continued challenges with the current public exchange to name a few.'

The company said it would continue offering policies through existing channels such as insurance agents or directly from the company.

The marketplace is the only way for insurance shoppers to get tax credits to help defray their costs.

Wellmark said that for plans held by people younger than 65 that do not meet the requirements of the Affordable Care Act, the requested rate increase would be 5.9 percent or less. That would affect 130,000 of its members.

For those younger than 65 who have plans that do meet the law's requirements, which is about 19,000 members, the increase request will be between 11.9 percent and 14.5 percent.

The company said that individual rate increases will vary and renewal notices will be sent to members. The rate increases, if approved, would take effect Jan. 1.

Wellmark also said it will seek an increase between 2 percent and 4 percent for 90,000 small group plan members whose plans do not meet Affordable Care Act requirements and an increase of less than 4.9 percent for the 14,000 members whose plans do meet those standards.

The Obama administration and the state of Iowa said earlier this year that insurers would be allowed to continue offering grandfathered plans to their customers, a reaction to the uproar over the cancellation of insurance plans last year.

Wellmark's announcement comes after two other insurers in the state who are participating in the online exchange detailed their own rate requests.

CoOportunity Health said last week that it was seeking a rate increase of 14.3 percent, affecting about 12,000 customers. It blamed much of its proposed increase on the decision to allow the grandfathered plans to be sold in the state, saying that has distorted the market.

Coventry Health Care, meanwhile, said its average proposed rate increase for individual plans would be an average of 8.7 percent, although the range was between a decline of 11 percent and an increase of 18.5 percent.

The state insurance division's office of the consumer advocate has scheduled public hearings on the CoOportunity and Coventry rate requests. But because hearings are required only for requested increases of 6.1 percent or more, only Wellmark's ACA-compliant plans will be subject to a hearing.