N.J. residents to get another HealthCare.gov option in 2015

UnitedHealthcare will sell health insurance to individuals in New Jersey in 2015 on the HealthCare.gov federal exchange, where consumers can get generous government subsidies under the Affordable Care Act to help defray the high cost of health insurance.UnitedHealthcare did not participate in the exchange’s first year in 2014, but for 2015 “UnitedHealthcare intends to file an application for New Jersey’s individual exchange, and look forward to continuing our conversations throughout the approval process,” Michael McGuire, CEO of UnitedHealthcare NJ, told NJBIZ on Monday.

Insurance broker David Oscar of Altigro welcomed UnitedHealthcare’s decision to join the New Jersey exchange.  

“That would be awesome. I am excited that there’s going to be a fourth option that is available, that would be great,” he said.

Joel Cantor, director of the Rutgers Center for State Health Policy, said, “The entry of a fourth carrier is good for the marketplace, will keep it competitive.”

But Oscar said he is concerned that premiums will be higher on the exchange in 2015 since there may not be enough young, healthy people enrolling, which is a major factor in keeping premiums under control.

“I would believe premiums will be a little bit higher because we have not had a year they went down,” he said.

Oscar said a number of his clients received substantial subsides on HealthCare.gov. “I have a lot of converts that used to not like Mr. Obama that now love him to death because of the subsidies.”

Christine Stearns, vice president for health and legal affairs at the New Jersey Business & Industry Association, said, “Choice and competition are always a good thing for purchasers. So having another carrier participate in the marketplace is a good thing for purchasers and we look forward to seeing expanded offerings in the marketplace.”

The exchange launched this year with three New Jersey health insurers on board: Horizon Blue Cross Blue Shield of New Jersey; AmeriHealth New Jersey; and Health Republic Insurance of New Jersey, a new co-op insurer financed with loans from the ACA. In November insurers will begin selling policies on HealthCare.gov that will take effect in 2015.

Two other New Jersey health insurance providers, Cigna and Aetna, also disclosed their plans for New Jersey in 2015.

Cigna “will not participate in the ACA marketplace in New Jersey in 2015, but we will continue to evaluate for future years,” spokesman Mark Slitt told NJBIZ.

While Aetna did not specifically rule out entering the New Jersey exchange in 2015, “Our bias is to participate on the 17 exchanges where we are today, which is more states than any other national carrier,” the company said.

Linda Schwimmer, vice president of the New Jersey Health Care Quality Institute, said, “The fact that more insurers are entering the market is a positive sign, and is really a result of the high enrollment numbers. It’s not surprising that some are still staying out — there’s a lot that goes into these decisions and there are still a lot of unknowns.”

She said the unknowns include how many exchange enrollees will wind up dropping their plans, how the new enrollees will utilize the health care system and whether more young people will sign up and also maintain their coverage.

“The more competition in an exchange the more downward pressure there will be on cost which ultimately helps consumers.  I hope that more carriers, especially smaller innovative technology centric plans will also enter the marketplace in New Jersey,” Schwimmer said.

She said new carriers have also entered the Medicaid market, another positive development.

Alongside the ACA exchange, New Jersey insurers continue to sell policies in the state’s traditional individual and small group market. The exchange small group market, called SHOP, did not do a full online launch in 2014, but is expected to be fully operational for 2016.

Just as individuals must go the exchange to get subsidies, small businesses have to purchase policies on SHOP to get access to tax credits that can lower their insurance costs.

Last week the federal Department of Health and Human Services released figures showing that the ACA subsidies substantially reduced the cost of coverage for New Jerseyans who qualify for them. The subsidies are on a sliding scale based on income, and phase out entirely at four times the federal poverty level, or $46,680 for an individual and $95,000 for a family of four.

HHS said New Jerseyans are paying an average of $148 a month, after government subsidies, for health plans purchased on HealthCare.gov. That’s far higher than the national average of $69 a month. New Jerseyans on average saw a 68 percent reduction in premiums as a result of the federal subsidies under the ACA. 

Before the tax credit, the average premium for New Jerseyans was $465 a month. The tax credits knocked $317 off that premium, on average, and 84 percent of New Jerseyans who bought a plan on HealthCare.gov received a government subsidy, according to HHS.

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