One Insurer Holds Subsidies Hostage in Two States
Written by Editor   
Tuesday, September 23, 2014 04:38 PM

In Iowa and South Dakota, the two states where the ACA insurance marketplaces struggled the most, just 11.1% of residents eligible for subsidized insurance signed up for it. 

The individual insurance market in both states is dominated by one insurer, Wellmark Blue Cross and Blue Shield. The company chose not to sell on the ACA exchanges in the first year, locking its consumers out from buying subsidized plans from the company. And it is staying out of the Iowa and South Dakota exchanges for year two.

Before last year's enrollment, Wellmark had 87% of the individual market in Iowa and 73% of South Dakota's market.  "There are a lot of people out there who are eligible for help who aren't getting it."

Medical underwriting was the process that insurers used to exclude people with pre-existing conditions before the Affordable Care Act. Consumers would have to fill out detailed health history forms, and if an insurer didn't want to take on the risk of someone who had high cholesterol or back pain, it didn't have to. Insurers can't do that anymore under the health law, but they can work to keep customers they already have – and have already screened.