Moda Health leaving Alaska individual health market in ’17

JUNEAU — One of the two companies offering individual health insurance policies for Alaskans announced Monday that it will not be participating in that market next year. The announcement by Moda Health would leave Premera Blue Cross Blue Shield as the only company providing individual health insurance policies in the state as of Jan. 1.

Moda said current individual health insurance policyholders and those who enroll in such plans in 2016 in Alaska will be covered through Dec. 31. The company has about 14,000 individual members in Alaska, it said.

High claim costs and a relatively small market have been ongoing concerns in Alaska. The state approved average rate increases of close to 40 percent for each of the companies for 2016. That was on top of double-digit rate increases for 2015.

In a release, Moda’s director of Alaska sales and service, Jason Gootee, said preliminary calculations by the company indicated it would need a significant premium increase in 2017 to be sustainable on the individual market.

“At some point, you can’t keep passing these significant costs on to consumers,” he said in the release. “Like many others, we want this market to have long term sustainability and we look forward to continuing the conversations with our many statewide partners on future market reforms.”

Late in the regular legislative session, Gov. Bill Walker proposed a program aimed at spreading the cost of claims for the costliest conditions across all insured markets, rather than to have them just be borne by the smaller individual market. The legislation received hearings but did not reach floor votes. It so far has not resurfaced during the extended session that began April 18.

As of Jan. 1, as the situation stands that with Moda’s announcement, the choice for individual health coverage on or off the federally facilitated online marketplace will be Premera, said Lori Wing-Heier, the director of Alaska’s Division of Insurance. Wing-Heier said she learned of Moda’s plans Monday morning.

Gootee said Moda decided to leave the individual market in the state to focus on other lines of business in Alaska, such as group medical and individual and group dental plans.