CareSource is expanding its offerings on the Affordable Care Act insurance marketplace amid uncertain times for the federal health law and one expert says the company is taking a risk.
The Dayton-based Medicaid managed care provider has been selling individual insurance plans on the federal exchanges created under Obamacare and recently announced it would offer a plan in 2018 in Paulding County, the lone county left in the U.S. without an insurer.
“At CareSource, we are driven by our mission to serve uninsured populations by giving them access to affordable coverage,” the company said in a statement. “That was our premise and the opportunity we saw when we entered the Marketplace in 2014 and we remain committed. Selecting coverage on the Marketplace is still one of the best options for consumers who don’t have other coverage.”
Ohio was originally on par for 20 counties with no insurer selling individual plans after Anthem Blue Cross and Blue Shield and other insurers stated they were pulling out of the exchanges, which left the Ohio Department of Insurance scrambling to work with insurers to find a solution and fill all the gaps.
Scott McGohan, CEO at McGohan Brabender, a Dayton firm that helps business customers navigate employee benefits, said CareSource is taking a risk by expanding its offerings to cover these bare counties when other insurers have lost money and scaled back their offerings on the exchanges.
“It’s probably humble for them (CareSource) to say, ‘We will take care of these areas.’ I think the question is, can they afford that long term?” McGohan said.
CareSource, which has been rapidly growing its employment base in downtown to more than 2,200 workers, primarily has been growing its business through its Medicaid managed care plans but has also stepped up to sell more private insurance plans on the exchanges in not just Paulding County but also in eight other Ohio counties and four Indiana counties with otherwise no options for next year.
“Leaving those people without any options and loss of coverage is a disaster and we’re better than that,” McGohan said.
CareSource said in a statement that when the nonprofit realized Paulding County was the last remaining location without a marketplace option for 2018 it assessed its network coverage options in neighboring Allen County where it currently offer marketplace coverage and “knew we could meet the network requirements for consumers that would be without coverage options.”
But it’s an uncertain time for the marketplaces created by the Affordable Care Act, with President Donald Trump threatening to end federal payments to help cover the cost of offering marketplace insurance plans at reduced rates. And that’s on top of the ever rising cost of health care and the uncertainty created from whatever lingering ability Congress might still have to repeal and replace the health law.
The cost sharing reduction payments help cover the requirement under the ACA, also known as Obamacare, to reduced deductibles and copays to people buying insurance on the marketplaces who have incomes between 100 to 250 percent of the poverty level. Trump has been deciding month by month whether to continue the payments and so far has made the payments.
Ohio Department of Insurance Director Jillian Froment said in a statement last week that making sure all counties had coverage was a temporary solution that only applies to 2018.
“Beyond that, insurers are still looking for predictability in the health insurance market,” Froment stated. “Now is the time for Congress to work on reforms that will strengthen our health insurance markets in ways that improve access and affordability.”
There’s also the challenge that the marketplaces have attracted people with serious health problems who need lots of care but the marketplaces have not had as much luck attracting younger, healthier people who would help balance out the cost.
McGohan said CareSource’s success will likely depend on whether more healthy people can be drawn into buying individual marketplace plans to help pay for the high cost of caring for the sickest people on the plans.
“The Affordable Care Act, unfortunately, made it attractive for the sickest to jump in and the healthiest to jump out,” he said. “So their position or their energy might be around around how do I attract the youngest and the healthiest to offset the oldest and the sickest?”
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