Blue Cross and Blue Shield of New Mexico has confirmed that it will not offer on-exchange individual health insurance products on the New Mexico Health Insurance Exchange in 2016.
According to the insurer, the premium rates BCBSNM charged for individual insurance products in 2014 and 2015 did not cover the claims costs the insurer incurred — ultimately resulting in a $19.2 million loss.
“BCBSNM is extremely disappointed that we will not be an option for our customers on the New Mexico Health Insurance Exchange in 2016. We have been serving New Mexicans for 75 years and we hope to provide more options to individuals in the future,” said Kurt Shipley, president of BCBSNM. “While we are committed to helping communities expand access to health insurance, we cannot offer products in a sustainable and predictable manner without adequate rates. We will continue to offer an HMO product off-exchange in 2016, which will be available to all consumers.”
The decision comes after the Office of the Superintendent of Insurance (OSI) formally denied the insurer’s 51.6 percent premium rate increase earlier this month. At the time of the decision, Shipley told Business First that the company had submitted a revised rate proposal that would have resulted in an 11 percent increase in premium rates for individual insurance products. The OSI responded that it didn’t consider the proposal to be a “real offer or realistic offer.”
According to Lisa Reid, director of the life and health division of the OSI, their office was unaware of BCBSNM’s decision as of this afternoon.
“We have not received a hearing request from BCBS. We disapproved the rate filing on July 27 and they have 30 days to ask for a hearing, so we are giving them until midnight and should know tomorrow,” Reid said. “We have already transferred the approved plans to the Federally Faciliated Marketplace and BCBS was not among them, so no individual exchange presence, barring a last minute hearing request. They will still be on the SHOP and will have one individual Bronze off-exchange plan at last year’s rates. Even with that, it would not be resolved in time for the beginning of open enrollment and when I asked the Center for Consumer Information and Insurance Oversight (CCIIO) how they would handle a hearing, they were unwilling to commit,” she said.
BCBSNM stressed that individual insurance policies will remain effective through the end of 2015 and small group, large group, commercial and individual dental product members will not be affected by the decision. In addition, Medicare Advantage Prescription Drug and Medicaid product lines will not be affected.
Approximately 35,000 people are currently enrolled in BCBSNM’s individual HMO and PPO plans and will need to find new insurance options before Jan. 1. Shipley said members will be formally notified by mail before Oct. 1.
The other four carriers — Presbyterian Health Plan, New Mexico Health Connections, Molina Healthcare and CHRISTUS Health Plan — will remain on the exchange next year.
Date: August 26, 2015