North Carolina and Georgia, two poor Southern states (PDF) led by Republican governors, rounded out the top five with $1.59 billion and $1.24 billion of consumer premium subsidies for 2015, according to data the CMS released last week. That data showed about 9.9 million people paid for their health plans, based on figures from state exchanges and the federal HealthCare.gov portal.
California, Florida and Texas have attracted several new insurers for 2015 and next year, such as tech-based Oscar Insurance Corp. and national giant UnitedHealthcare, because of the sheer size of their individual markets. Analysts say the fact that a portion of premiums is guaranteed through the ACA's federal subsidies adds to the business allure.
Subsidies are also flowing more to Republican states with high volumes of poor, unhealthy people. Wisconsin ranks 20th in the country in population, according to Census Bureau data, but health insurers in Wisconsin are receiving $616 million in premium subsidies this year, 11th-most in the country. Louisiana is the 25th most populous state, but companies are collecting $497 million in premium subsidies this year, 15th among all states. Tax credits are also plentiful in Alabama, Mississippi and South Carolina.
The health status of the newly insured has forced some insurers to pull back on their exchange investments. For instance, Health Care Service Corp., the parent of Blue Cross and Blue Shield of New Mexico and four other state Blues plans, pulled out of New Mexico's exchange in August after the state did not approve higher prices for premiums. The insurer said premiums did not cover the cost of care.
HCSC's Texas subsidiary also eliminated some individual plan products for 2016, citing more financial difficulties. HCSC lost $282 million in 2014, due in large part to the costs of exchange plan members. However, the ACA included some risk mitigation programs to help pay for the uncertainty of expanding coverage to a new group of people.