Illinois submits big Obamacare rate increases to the feds

Hundreds of thousands of Illinois consumers who buy health insurance on the state's Obamacare exchange will likely see average rates increase by 16 to 37 percent next year for the lowest-priced plans, according to a new analysis.

The Illinois Department of Insurance submitted rates to the federal government Wednesday that would increase the average cost of the lowest-priced silver plans by 35 percent statewide. The lowest-priced bronze-level plans would increase, on average, by 20 percent, and the lowest-priced gold plans would increase by 16 percent, according to a department analysis obtained by the Tribune.

For example, a 21-year-old nonsmoker could pay $315 a month for the lowest-priced silver plan in Cook County next year, compared with $221 a month this year, according to the analysis. A 21-year-old nonsmoker in DuPage and Kane counties could pay $338 a month next year for the lowest-priced silver plan, versus $266 this year.

The analysis follows the release last month of proposed rate increases from insurers, which in many cases showed large average jumps over last year. The new analysis shows average increases for different levels of plans across the state, breaks down some of the likely increases by county and shows which insurers will offer plans where. Rates will not be finalized until October, shortly before consumers may start choosing plans during open enrollment, which starts Nov. 1.

Illinois consumers will also see less competition among insurance providers on the exchange, according to the analysis.

In 13 counties next year, only one insurer will offer individual plans — nearly double the number of Illinois counties that have only one insurer on the exchange this year. Counties that will be limited to one choice include Lake, McHenry and DeKalb as well as a number in the northwest corner of the state and southern Illinois.

Like this year, Blue Cross and Blue Shield of Illinois will be the only insurer offering individual PPO plans on the exchange.

The Department of Insurance reviewed the rates, but generally cannot reject or change proposed rates, though it does have the power to try to negotiate them lower.

Many have attributed the rate increases this year, and in years past, to problems with Obamacare.

Department of Insurance Director Jennifer Hammer said in a news release, "There is no question that major structural flaws in the (Affordable Care Act) have forced higher insurance rates and separated families from trusted physicians and hospitals."

A spokesman for the U.S. Department of Health and Human Services said in a statement Thursday, "Years before the Trump Administration came to office, Obamacare's double-digit rate increases and onerous mandates have been squeezing the pocket books of the American people."

Others, however, blame next year's potentially higher rates largely on uncertainty surrounding the Affordable Care Act and threats by the Trump administration to stop paying federal subsidies to insurance companies. In many cases, Illinois insurers have cited uncertainty surrounding the health care law as a reason for the likely increases.

"It's just more indication of what we've seen already, which is (that) the incredible uncertainty that is being injected into the health care system by the Trump administration is causing chaos," said Stephani Becker, a senior policy specialist at the Sargent Shriver National Center on Poverty Law.

Congressional Republicans have so far failed to pass a plan to repeal or replace Obamacare, but are still trying and may vote on another bill before the end of the month.

Becker said many Illinois consumers — those who receive tax credits to help them offset the costs of their premiums — will be sheltered from the likely increases. But those who don't receive the tax credits, about one-quarter of Illinois residents with insurance through the exchange in 2016, will feel the full effects.

"It's going to be a huge shock to their pocketbooks, and I'm not sure what they're going to do," Becker said of consumers who don't receive the tax credits. "I'm not sure if they're going to shop off-exchange or remain uninsured for the year."

The vast majority of consumers in Illinois get health insurance through employers or government programs such as Medicare and Medicaid. But this year, more than 350,000 Illinois residents enrolled in exchange plans. Consumers can also buy individual plans outside the exchange but they can't receive tax credits if they go that route.

Small businesses in the Chicago area will also face a lack of options next year, according to the analysis. Blue Cross and Blue Shield of Illinois decided to no longer offer plans for small businesses on the SHOP (Small Business Health Options Program) exchange next year. Health Alliance Medical Plans will continue to offer plans on the small business exchange but only outside of the Chicago area.

That means no insurer will offer plans on the SHOP exchange in Cook, Lake, McHenry, Kane or DuPage counties next year, according to the analysis.

Blue Cross and Blue Shield of Illinois spokeswoman Colleen Miller said the insurer will still offer plans for small businesses outside the exchange next year.

Elliot Richardson, CEO of the Small Business Advocacy Council, said Wednesday that less competition among insurers is bad news for small businesses in the Chicago area.

"It's very difficult to find affordable health insurance, so we need more competition overall, not less," Richardson said. "When small business owners have trouble obtaining affordable, quality health insurance because of a lack of competition, it does impact the growth of that business, it impacts the operations of that business and it can impact whether a small business wants to bring on new employees."

Information about which hospitals and doctors will be included in different plans' networks won't be made public until October.

lschencker@chicagotribune.com

Twitter @lschencker

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