The Arkansas Insurance Department today announced that five companies plan to sell health insurance plans on the Arkansas Health Insurance Marketplace in 2015, the second year for the regulated marketplace created by the Affordable Care Act. The issuers that have filed are Arkansas Blue Cross Blue Shield, the national multi-state Blue Cross Blue Shield, Celtic Insurance Company (selling in Arkansas as Ambetter), and two companies owned by the parent company QualChoice Holdings: QualChoice Life and Health Insurance Company, Inc. and QCH Health Plan Inc. (QualChoice Holdings is itself owned by Catholic Health Initiatives, which acquired the company earlier this year.)
QualChoice only sold via one company — QualChoice Life and Health Insurance — last year; otherwise, these are the same carriers that sold on the Marketplace in 2014. Insurance Department officials had also been in talks with another company regarding the coming plan year, hoping to bring a new carrier in to the state, but that company chose not to join the Arkansas Marketplace in 2015.
The two QualChoice companies offer two different types of insurance plans: QualChoice Life and Health Insurance will offer “point of service” (POS) plans and, new next year, QCH Health Plan will offer “preferred provider organization” (PPO) plans (the two types of plans require different licenses, which have to be held by separate entities).
“The first year we only filed one company on the exchange because it was new and we wanted to dip our toe in the water slowly,” said QualChoice CEO Mike Stock. “Now that we’ve done that and got our foot wet, we’re going to file both companies so we can sell all of our products on the exchange.” Stock said QualChoice was aiming to “broaden consumer choice” and “increase our market share in the state.”
The addition of the second QualChoice company will mean additional choices for consumers, and means that Blue Cross, which sells only PPO plans, will have an additional competitor for that type of plan. Broadly speaking, though, in terms of carrier competition on the Arkansas Marketplace, 2015 will look a lot like 2014, with three parent companies offering plans. (While the state Blue Cross and the national Blues are two different entities, many are skeptical that they represent true competitors in practice.)
The biggest difference in 2015 will come in more rural areas of the state. Both QualChoice and Ambetter plan to sell statewide next year. Last year, only the two Blue Cross companies sold statewide, with QualChoice selling in five of the Marketplace’s seven regions and Ambetter selling in two of them. That left chunks of the state with only the Blues to choose from. There will be significantly more competition and more consumer choice in underserved regions of the state in 2015.
In addition to serving Arkansans shopping for individual health insurance, the Marketplace is also where plans are purchased for the private option, the state’s unique plan using Medicaid funds to purchase private health insurance for low-income Arkansans. Carrier competition is frequently cited by private option proponents as key to keeping costs down. The fact that all of the carriers are selling statewide next year is good news, but whether there are enough carriers to establish meaningful competition (and put a dent in the market share domination of Blue Cross) remains an open question. Meanwhile, the private option will likely provide close to 200,000 customers next year. If the legislature decides to defund the policy next year, that could push carriers out (or scare off possible new entrants in the future years).
Press release from the Insurance Department after the jump:
Arkansas Insurance Commissioner Announces
Companies Filing 2015 Plans on Health Insurance Marketplace
LITTLE ROCK, ARKANSAS (July 2, 2014) ─ Arkansas Insurance Commissioner Jay Bradford announced that five companies have filed to sell individual health insurance plans on Arkansas’s Federally-facilitated Health Insurance Marketplace for the 2015 plan year.
The issuers filing for qualified health plan certification are Arkansas Blue Cross Blue Shield, Celtic Insurance Company, National Blue Cross Blue Shield Multi-State, QCH Health Plan Inc., and QualChoice Life and Health Insurance Company, Inc.
The companies submitted plans and service areas for 2015, which will be carefully reviewed for adequacy. The Arkansas Healthcare Independence Act of 2013 requires that consumers in each of Arkansas’s 75 counties have a choice among at least two health insurance issuers.
Commissioner Jay Bradford said, “It has always been my desire, and in the best interest of the Arkansas consumer, to have quality competition and choice on the Health Insurance Marketplace.” Bradford said he was pleased with the level of participation the industry continues to show.