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Wellmark announces individual ACA market changes in Iowa and South Dakota

September 28, 2016

DES MOINES, Iowa — Wellmark Blue Cross and Blue Shield announced today it will make changes in the individual Affordable Care Act (ACA) market in Iowa and South Dakota.

For the past two years, Wellmark members with individual ACA plans have endured double-digit increases. In addition, Wellmark has lost approximately $99 million over the same time period in the individual market in Iowa and South Dakota.

“Wellmark’s mission is to create affordable health insurance for people to access quality health care. And, for the majority of the past 75 years, we’ve been able to achieve that,” said Wellmark Chairman and CEO John Forsyth. “However, it’s apparent that continuing to offer plans with broad networks, combined with the rich benefits of the ACA, is not consistent with managing continually rising costs. While we could seek additional premium increases to mitigate rising costs, this is not sustainable for our members’ pocketbook.”

Iowa changes

In Iowa, Wellmark will narrow its product choices to offer plans that are lower priced and encourage health care delivery by Iowa providers. Specifically, Wellmark will no longer offer gold tier plans nor will the company promote individual under 65 plans that use its Preferred Provider Organization (PPO) network in Iowa. Individual ACA members with a silver or bronze PPO plan today may continue on that plan for 2017.

The announced changes do not affect people with grandfathered or grandmothered plans (those that generally purchased their individual plans prior to Jan. 1, 2014). It also does not affect members with plans through their employer or those with Medicare supplement plans.

Wellmark will also continue its plans to:

  • Introduce a new, simplified HMO plan called Blue Simplicity℠. This plan is like no other on the market today and is designed to help consumers understand the true value of care through simple copay plans – providing members with transparency and predictability of cost as they seek and use medical services.
  • Debut two new health insurance companies – Wellmark Value Health Plan (with Mercy Health Network) and Wellmark Synergy Health (with University of Iowa Health System). These new plans are a result of relationships with provider partners who are committed to managing the care of Wellmark members.
  • Participate on the public exchange. Wellmark Value Health Plan and Wellmark Synergy Health will offer individual ACA plans both on and off the public exchange in a total of 40 Iowa counties, providing access to subsidies and cost share reductions to many Iowans when they purchase a plan on the exchange.

South Dakota changes

In South Dakota, Wellmark will no longer offer individual Affordable Care Act (ACA) plans effective Jan. 1, 2017. The decision affects less than 8,000 — or two percent — of Wellmark’s 378,000 members in South Dakota. Members who currently have an individual ACA plan will continue to have coverage through Dec. 31, 2016.

The announced changes do not affect people with grandfathered or grandmothered plans (those that generally purchased their individual plans prior to Jan. 1, 2014). It also does not affect members with plans through their employer or those with Medicare supplement plans.

Forsyth said while Wellmark has been able to respond to some of these challenges in Iowa, current provider relationships are structured in such a way that do not allow us the flexibility to form similar relationships with providers or create select HMO products as we have in Iowa.

“Although the ACA has done many positive things, it has also had its challenges and those challenges vary by state,” said Forsyth. “Fortunately, in 2017, the ACA gives states the ability to begin addressing those challenges with the goal of stabilizing the individual under 65 health insurance market. We look forward to working with Iowa and South Dakota policymakers on those solutions in the near future.”

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