New Jersey

At long last, I've finally wrapped up my 50-state (+DC) 2021 Rate Change project...or at least the preliminary rate filings; I have the final/approved rate changes for 18 states as of this writing.

I'm finishing things off with New Jersey, and unlike the past half-dozen or so states, I am able to run a properly weighted average for both the individual and small group markets in the Garden State even though, like many other states, the actuarial memos are either unavailable or heavily redacted.

I'm able to do this thanks to NJ's policy of providing public quarterly reports tracking their individual and small group market enrollment, including breakouts by carrier (they also break it out by metal level, HMO vs. PPO and so forth, which is awesome for data wonks).

In any event, based on the Q2 2020 report (which includes enrollment data updated through the end of June), 2021 enrollees in New Jersey's individual market are looking at average premium increases of around 4.1%, while small group plans are going up by roughly 2.6% on average.

It was a little over a year ago that New Jersey legislators passed, after some last-minute drama, a bill to follow in the footsteps of Nevada and split off from the federal ACA exchange, HealthCare.Gov (there's actually a dozen other states which also operate their own full state-based exchanges as well, but 11 of them were never hosted by the federal exchange in the first place. The exception is Idaho, which was hosted by HC.gov for one year before splitting off, but that was always their plan from the start).

New Jersey's ACA portal website, Get Covered NJ, has actually been live for two enrollment periods already, but until now it was just that--an information portal only. The actual healthcare policy shopping/enrollment process was still handled through HealthCare.Gov.

Last May, New Jersey Democratic legislators were pushing through over a dozen bills which would effectively lock in nearly all of the ACA's "Blue Leg Protections", as I refer to them, at the state level. The main reason for this, of course, is to replicate federal ACA protections for enrollees just in case the U.S. Supreme Court does ultimately strike down the Affordable Care Act (or at least strikes down the consumer protection parts of it).

Well, I kind of lost track of the status of those bills over the summer and fall, but apparently most of them passed through both the New Jersey state House and Senate because just moments ago, NJ Governor Phil Murphy issued the following press release:

 

This isn't the biggest development in the world, but exactly a year ago today I made a big fuss about how New Jersey (and DC) had reinstated their own health insurance individual mandate penalties after the federal version was zeroed out by Congressional Republicans...but didn't seem to be going through much effort to let people know about the penalty.

While Massachusetts had launched a massive multi-media awareness/education blitz statewide to make sure people knew that they had dusted off their pre-ACA coverage mandate requirement, New Jersey and DC didn't appear to be doing much, if anything, to let people know that they'd face a stiff tax penalty if they didn't either #GetCovered or qualify for an exemption.

As I noted at the time, just like the Doomsday Device in Dr. Strangelove, it completely defeats the whole point of having a penalty if no one knows it exists.

This was posted by NJ Governor Phil Murphy a week ago but it's still noteworthy, especially considering that NJ is in the process of splitting off from HC.gov onto their own full ACA exchange next year as Nevada just did:

Governor Murphy and New Jersey Department of Banking and Insurance Kick Off ACA Open Enrollment Period

Governor Announces Strengthened ACA Efforts, including $3.1 Million to Support Outreach and Enrollment Efforts and Bolstered Get Covered NJ Awareness Campaign

TRENTON – Governor Phil Murphy, joined by Department of Banking and Insurance (DOBI) Commissioner Marlene Caride and enrollment assisters from across the state, today announced Navigator grant awards totaling $1.1 million to provide enrollment assistance to residents shopping for health coverage during the six-week open enrollment window. DOBI plans to release approximately $500,000 more in grants in the coming days.

This Just In, via the New Jersey Dept. of Banking & Insurance...

NJ Department of Banking and Insurance Releases Health Plan Rates
On Average, NJ Individual Market Rates for 2020 Remain 1.4% Lower Than 2018

The New Jersey Department of Banking and Insurance today released rates for health insurance plans in the individual market effective January 1, 2020. On average, rates for 2020 will remain 1.4 percent lower than they were in 2018, due to policy actions taken by the Murphy Administration to stabilize the insurance market. 

OK, hold up, read that again: 1.4% lower than 2018 premiums, not 1.4% lower than 2019. That's kind of an important distinction. Don't get me wrong, this isn't a bad thing to note, but it's not that impressive considering some other states are seeing rate reductions from 2018. Of course, there's a lot of factors at play which vary from state to state as well.

*(Yes, I know, the District of Columbia isn't actually a state, and Vermont's mandate is...well, read on...)

As the 2020 Open Enrollment Period rapidly approaches (it starts November 1st nationwide...except for California, where open enrollment is starting on October 15th), it's time to start getting the word out about some important things to keep in mind this fall.

One of the most critical things to remember for residents of California, the District of Columbia, Massachusetts, New Jersey, Rhode Island and Vermont is that each of these states* has reinstated an individual healthcare coverage mandate law/ordinance to replace the federal ACA mandate penalty which was zeroed out by Congressional Republicans back in December 2017. This means that if you live one one of them, unless you receive an affordability, hardship or other type of acceptable exemption, you'll be charged a financial penalty when you file your state/district taxes for 2020 in spring 2021 if you don't have qualifying healthcare coverage.

One of the interesting quirks of how the Affordable Care Act's enhancement of our crazy patchwork heatlhcare system works is that there's something of a zero-sum game when it comes to enrollment numbers.

For instance, Virginia's ACA exchange enrollment numbers dropped by 18% this year, from 400,000 to 328,000, due primarily to the state finally getting around to expanding Medicaid to enrollees earning less than 138% of the Federal Poverty Level. Since people earning between 100-400% FPL are eligible for ACA subsidies if they enroll through the exchange, that means there's an overlap for those in the 100-138% range which these folks fell into. The same thing happened in Louisiana, even more dramatically, after they expanded Medicaid halfway through 2016...the following year exchange enrollment dropped by 33%.

MLR rebate payments for 2018 are being sent out to enrollees even as I type this. The data for 2018 MLR rebates won't be officially posted for another month or so, but I've managed to acquire it early, and after a lot of number-crunching the data, I've recompiled it into an easy-to-read format.

But that's not all! In addition to the actual 2018 MLR rebates, I've gone one step further and have taken an early crack at trying to figure out what 2019 MLR rebates might end up looking like next year (for the Individual Market only). In order to do this, I had to make several very large assumptions:

  • First, I've assumed that total enrollment for each carrier remains exactly the same year over year.
  • Second, I've assumed that the average 2019 rate changes I recorded for each carrier last fall are accurate.
  • Third, I'm assuming that 2019 is seeing a 5% medical trendline on average...that is, that total 2019 claims per enrollee will be 5% higher than 2018's.

All three of these are very questionable, of course, but they at least provide a baseline.

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