People in 36 of Mississippi's 82 counties may not be able to buy health insurance through the new federal online marketplace
when it starts enrolling customers in October.
Mississippi Insurance Commissioner Mike Chaney says two insurers have announced offerings so far, planning to serve 46 counties.
Unless more companies sign up or the existing companies expand their plans, consumers in the remaining counties won't be able to buy health insurance through the online exchange. Coverage under those policies begins Jan. 1
"I don't know what to tell you about the other 36 counties," Chaney told the Associated Press in a phone interview this week. "You're just out of luck."That means they won't be able to use federal tax credits offered to consumers with incomes of between 133 percent and 400 percent of the federal poverty level. That's up to about $46,000 for an individual and about $94,000 for a family of four, with those at the top end getting little or no subsidy.
People who don't buy insurance are required to pay a $95-a-year penalty starting in 2014. A spokeswoman for the U.S. Treasury Department couldn't immediately say Thursday whether people would be penalized in counties without offerings.
Residents in the 36 counties will still be able to buy individual policies through the traditional market, as well as rely on insurance provided by employers or government plans such as Medicaid
Under the federal health care law that President Barack Obama signed in 2010, every state is required to have an online marketplace so people can get coverage starting in January 2014, much of it federally subsidized. A 2012 study by the Mississippi Center for Health Policy had projected that as many as 275,000 Mississippians could gain insurance through exchanges, with 230,000 of those benefiting from federal tax credits that could total $900 million a year.
The marketplace program is separate from proposals to expand the state-federal Medicaid program to cover people with incomes up to 138 percent of poverty.
In February, the federal government rejected Chaney's effort to create a state-based exchange in Mississippi because of opposition by fellow Republican Gov. Phil Bryant. That means Mississippi's market will be run by the federal government.
Chaney had contended that a state-run exchange would attract more insurers. "We would definitely have more options and I would have more authority," he said.
Bryant spokesman Mick Bullock said the governor had no role in the marketplace.
"If insurers are uninterested in participating in that exchange," Bullock said, "it is because of the serious problems with the Affordable Care Act
itself and burdensome HHS regulations, not anything the governor has done."
Magnolia Health Plan will offer coverage in 46 counties. It is a unit of St. Louis-based Centene Corp., and runs a Mississippi Medicaid network with 77,000 enrollees. Humana, based in Louisville, Ky., will offer coverage in four of the 46 counties — DeSoto, Hinds, Rankin and Madison — that will also be included in Magnolia's plan.
Areas that won't have coverage offered through the online marketplace include swaths of the Delta region and southwest Mississippi, plus scattered areas elsewhere. Among those areas are Corinth, Greenville, Laurel, Natchez and Picayune.
Chaney said the department has been told that the state's two largest private insurers, Flowood-based Blue Cross & Blue Shield of Mississippi and UnitedHealth Group of Minnetonka, Minn., would not offer plans on the online marketplace beginning in October.
Meredith Virden, a spokeswoman for Blue Cross, declined to confirm the company's plans or comment. UnitedHealth's Elizabeth Calzadilla-Fiallo said the company is still looking at options.
Dr. Jason Dees, the CEO of Magnolia Health Plan, said the company plans to offer coverage at "a very affordable price" if state and federal authorities approve its rate filing. It would be aimed at people who might have been on the Medicaid plan managed by the company, but get a job and become ineligible for coverage.
"Many people who transition off of Medicaid have no coverage at that point," Dees said.
Offerings would mimic Magnolia's Medicaid plan in terms of allowed drugs and available physicians. Dees said making sure people who lose Medicaid eligibility stay insured will help them manage chronic conditions. And even for those who might find insurance elsewhere, staying with Magnolia saves the cost of switching drugs and doctors
Because Mississippi is a small, poor state whose market is dominated by Blue Cross, it's not surprising that there isn't a flood of new entries, said Gary Claxton, a vice president of the Kaiser Family Foundation who leads a project studying the health insurance market. Any new insurer would have to try to sign up a network of doctors and hospitals, and could have a hard time negotiating favorable payment rates because it would have few customers at the beginning.
"The thing that makes it difficult is getting a network together, because you don't have market share," Claxton said.
Still, those who follow Mississippi said they were surprised that some areas would be without coverage options on the new online marketplace.
"I was not expecting Mississippi to have a wide array of options," said Therese Hanna, executive director of the Mississippi Center for Health Policy. "I was hoping we would have more than two companies and it did not occur to me that there would be areas that wouldn't be covered."
Availability could improve in 2015 or 2016. By then, for example multi-state plans may be offered in Mississippi. Claxton said the national Blue Cross and Blue Shield Association,UnitedHealth and Humana are all expected to offer national plans.
Chaney said he believed opposition to health care changes by many Mississippi Republicans, along with the deadlock over renewing or expanding the state-federal Medicaid program was scaring off insurers. Roy Mitchell, executive director of the Mississippi Health Advocacy Program, which has been pushing for expanded coverage, agrees.
"We're in a polarized atmosphere here were our governor denies the Affordable Care Act even exists," Mitchell said. "Mississippi is just a worst-case scenario in these things.