To battle headlines of double-digit Obamacare rate increases, administration officials have said consumers will have enough plans to choose an affordable option.
But that choice can differ dramatically depending on where you live.
And if you live in Arizona, you are facing huge price increases and few options.
Seven insurers decided to leave the state’s Obamacare marketplace next year, leaving two. Blue Cross Blue Shield will provide plans for most of the state, and Centene will offer plans in Maricopa County, which includes Phoenix.
Aetna, Humana, UnitedHealth and Cigna are all bolting at the end of this year. So are smaller insurers Health Choice, Phoenix Health Plans and Health Net.
The departures have led to a staggering 93 percent drop in the average number of qualified health plans offered in the state, going from 65 plans in 2016 to four next year.
The lack of competition is coupled with sharp price hikes for Obamacare plans. The average rate increase next year is 116 percent in Arizona, the Obama administration announced Monday, well above the nationwide average hike of 25 percent.
In three other states, insurers will offer far fewer plans than the average 10 that the administration has said consumers will be able to choose from when open enrollment starts Nov. 1.
Alaska will have five plans, Alabama six and Tennessee seven, the report found. Alaska and Alabama only have one Obamacare insurer selling plans, while Tennessee will have three.
Besides those four states, insurers in other states will offer 10 plans or more, but residents in some states will see a major reduction in the number of plans offered.
Utah, which offered 70 plans in 2016, next year will have only 22. Tennessee had 57 plans on the market in 2016 but will have seven next year.
Overall, the average number of total qualified health plans offered in each state will be 30 in 2017, down 36 percent from the 47 plans offered in 2016.
The competition woes in certain states come as some major insurers have defected from the law’s exchanges due to profitability problems.
Tennessee had five insurers offering plans in 2016 but that has dropped to three. Blue Cross Blue Shield, a major insurer in the state, decided to not offer coverage in Knoxville, Nashville and Memphis.
“Our three-year losses on ACA plans are approaching just south of $500 million,” said Calvin Anderson, chief of staff for Blue Cross in Tennessee, in a webinar Wednesday sponsored by National Institute for Health Care Management Foundation.
Anderson said that a problem was who enrolled in Obamacare when marketplaces went online in 2014.
“There were fewer young, healthy members that enrolled than expected and the risk pool never grew large enough,” he said.
The Obama administration is trying to rectify the disparity by increasing its outreach to millennials this year and focusing on uninsured people who are paying the law’s individual mandate penalty.
The administration also has noted that having a single insurer doesn’t necessarily mean less choice.
South Carolina, for example, has one insurer that is offering an average 25 plans per county, according to HHS. Wyoming, another state that has just one insurer, will offer 28 plans.
In addition to Alabama, Alaska and Oklahoma will have one carrier next year. Oklahoma will offer 13 plans, down from 22 the year before.
HHS also said federal tax credits will help mitigate the rise in premiums.
“If every returning consumer nationwide selected the lowest-cost plan within the same metal level they picked last year, average premiums paid (taking into account financial assistance) would fall by $28 per month — 20 percent — compared to 2016,” the agency said.
Health and Human Services Secretary Sylvia Mathews Burwell said during an event at Georgetown Law School Wednesday that a government-run insurance option could help areas that have little competition.
“There are places where we would like to see more competition and would like to see things that settle the market,” she said.
