September 16, 2015
BCBSIL Announces Product Changes for Individual Members in 2016
The individual market has evolved significantly since the opening of the Health Insurance Marketplace in 2014. These changes require Blue Cross and Blue Shield of Illinois (BCBSIL) to make adjustments to our 2016 product offerings for the individual (retail) market that will allow us to continue offering sustainable health insurance options.
In 2016, BCBSIL will expand the Blue Choice Preferred PPOSM*, so that it will be an option in every county across the state. We are also expanding our Blue Precision HMOSM* to more markets, and intend to offer a new HMO product for the greater Chicago area.
However, the broad PPO that was offered for 2014 and 2015 will not be offered for the individual market in 2016. Details will be announced in October when the shopping window begins.
We are committed to offering competitively priced individual insurance options in every county in the state, both on and off the Marketplace.
Leading up to the beginning of open enrollment, we will continue to talk publicly about the plan transition, and make information available to individual members and key stakeholders.
Please note that we are letting BCBSIL employer groups know about this change to the individual (retail) market in case employees have any questions. Employer groups are also being informed that the individual (retail) market discontinuance does not impact the options available to our employer group customers and members. The broad PPO plan will continue to be available to employer groups across Illinois.
Below are FAQs you can use when reaching out to your Illinois customers. We recommend that you start having these conversations soon. They will receive notification letters by the end of the month.
We stand ready to assist you and your clients through this transition.
Frequently Asked Questions (FAQs)
Who does the broad PPO discontinuance impact?
Currently, we have about 173,000 individual Illinois members who will have their broad PPO plan discontinued in 2016. This number fluctuates monthly. Grandfathered and grandmothered PPO plans will not be discontinued. Retail members with grandfathered/grandmothered PPO plans will continue to use the broad PPO network.
While some group metallic plans are being discontinued, it is not a part of our broad PPO discontinuance for individual members.
We will be transitioning individual members with the broad PPO to Blue Choice Preferred PPO, unless they decide to choose a different product. We will work with these members and their providers to minimize the impact of this change to their ongoing care, particularly if they need to transfer their care to other providers.
Why is BCBSIL discontinuing the broad PPO?
Based on the actual medical cost numbers we were able to calculate for the first time this year, we found that the broad network broad PPO product is not sustainable at its current price. The amount of a rate increase that would have been needed to cover the costs of the broad PPO would have been too high to justify offering it to the market.
In the individual market segment in 2014, BCBSIL paid out more in claims than it collected in premiums. We have adjusted our offerings – as many insurers have – to be sustainable in the new market reality.
What will this mean for individual members who currently have the broad PPO plan?
BCBSIL will transition affected individual members to a similar plan, the Blue Choice Preferred PPO, so they will not experience a gap in coverage. They will also have the option of choosing a different plan during 2016 open enrollment.
Are there providers who were available under the broad PPO who will no longer be in network for BCBSIL members on any plan?
Some doctors and hospitals that were in the broad PPO plan’s network this year will be in the Blue Choice Preferred PPO network in 2016. However, not all health care providers will be in the 2016 Blue Choice Preferred PPO network. We have ensured that we will have an adequate network to provide the physicians and hospitals needed to serve our retail members in each market, and we continue to have discussions with additional providers.
What should members in the broad PPO do now?
This announcement does not affect a member’s coverage through the end of the year. There is no need to do anything right now.
Shopping for 2016 plans is expected to open in October, when insurers are allowed to publicly release the full range of plan offerings for the coming year. Members who will be having plan changes will receive a formal notice from BCBSIL by Oct. 1. They can begin looking at their plan options when shopping opens in October. They can keep the plan we’ve selected or pick a new plan beginning Nov. 1.
What new markets will be available for the Blue Precision HMO?
Subject to regulatory approval, we will be making Blue Precision HMO available to customers in the Peoria and Bloomington markets in 2016.
What details can you provide for the new HMO offering?
Our new HMO will be an exclusive network HMO in collaboration with one of Illinois’ major health systems. Subject to regulatory approval, it will be available for purchase in Cook, Lake, Kane and Will counties. This HMO will be our lowest-cost HMO, with low monthly premiums and low out-of-pocket costs. It will be offered on and off Get Covered Illinois, the Official Health Marketplace, for individuals and families. It will also be available for our small group customers.
We will be announcing the collaboration formally when the approved shopping period begins on in October. We will have details about the HMO plan at that time.
Will there be a rate increase for plans for 2016?
BCBSIL’s rate filings are currently under review by CMS, so that information won’t be available until rates are finalized and approved.
However, we did request a rate increase as we adjust our pricing based on newly available data on actual costs in 2014. Until now, we had to use historical data to project what we thought rates should be – we didn’t have complete data on the actual cost of providing care when we joined the Marketplace in 2014 or when filing our rates for 2015. The proposed 2016 rate increase is an adjustment that will allow us to keep providing coverage options across the state for people who don’t have insurance through an employer.
Is group subsidizing individual business?
The group line of business operates separately from the individual line of business. BCBSIL’s individual rates are only based on expected cost of doing business for 2016 for our retail business.
*Subject to approval by the U.S. Department of Health and Human Services.