North Carolina's largest health insurance company is raising the cost of its plans on the insurance exchange that's part of the Affordable Care Act. But the hike by BlueCross BlueShield shouldn't affect the pocketbook of most customers.
Insurance on the Obamacare exchanges is getting cheaper in some states, but not in North Carolina.
The Kaiser Family Foundation studied 16 big cities nationwide and found that average premiums for a benchmark plan will decline slightly next year. Most of those cities have at least five insurance companies competing on the exchange.
In North Carolina, BlueCross BlueShield easily dominates. It's the only company that offers plans in every county.
And those plans will be 13.5 percent more expensive on average next year. Patrick Getzen is the company's chief actuary.
"The population of the ACA group is older and less healthy than our customers have been in the past," he said on a conference call with reporters. "Many of our younger - and compared to other pools, healthier - individuals stayed in grandfathered or transition plans."
Getzen says it's simple: insurance companies spend a lot more on health care for older, sicker people, so plans with higher percentages of those folks cost more.
In actual premiums, one of BlueCross's most popular exchange plans will increase from $364 a month to $421 a month for a middle-aged person.
But the increases won't impact what most customers pay. That's because nine of out 10 BlueCross customers on the exchange get a federal subsidy.
Adam Linker of the N.C. Justice Center said the way the subsidy works, "the amount you pay for premiums is capped as a percentage of your income."
"Basically, if you get a subsidy, you're almost entirely shielded from rate increases," he said.
People with a "transitional plan" won't get any help. That's what BlueCross is calling the plans that were supposed to be canceled last year - before consumer outrage caused President Obama to give companies the option of offering them again. Getzen from BlueCross said they'll be more expensive.
"This group will see an average increase of 19.2 percent," he said. "But it is important to note that even though they have a higher percentage rate increase, many of our transition plans are some of our lowest cost plans," meaning they'll still be cheaper than plans on the exchange.
The exchange, transitional and other individual market plans all together make up a small percentage of what BlueCross offers.
Most people get insurance through their employers. A BlueCross spokeswoman said the company does not release average rates for that market.
Full presentation from BCBSNC:
BCBSNC Rates for Individuals Under 65 and Annual Enrollment Period