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The ACA crisis in North Carolina and beyond

North Carolina is encountering a health insurance crisis in the individual marketplace. With both Aetna and UnitedHealthcare bowing out of the market, Blue Cross and Blue Shield of North Carolina has requested new rating to increase premiums.

According to BCBS CEO Brad Wilson, the carrier is predicting that they may be taking on up to 200,000 new enrollees to absorb the pool previously held by Aetna and UHC. With that comes a broader risk pool with many more costly individuals than ever before covered by the carrier statewide.

For North Carolinians, the choice in carrier is almost entirely limited to BCBS for the 2017 plan year, with Cigna covering just five counties in the state. Here’s a visual representation provided by Forbes:

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Forbes makes a great point, however. The fault is not with the sick populations in NC. The problem is the arrangement of the ACA, and how it fails to keep the carriers, taking on unprecedented risk, afloat.

There is almost a threatening tone to the encouragement put forth by Affordable Care Act experts for young people to purchase insurance. One cornerstone of the ACA’s longterm model for success is for younger populations to enroll. However, statistically, many younger, healthy people forgo the immediate costs of monthly premiums in favor of paying the yearly fine later.

Without younger and healthier consumers, premiums and out-of-pocket costs continue to skyrocket. The ACA points out that if they want access to decent coverage years on down the line, these young and healthy individuals need to enroll today, but that just won’t cut it. This individual mandate is so weak that more healthy individuals are opting out of health insurance than before the ACA, and without pre-existing condition clauses, more costly individuals are opting in.

There’s also an allowance for a three-month grace period, in which the individual is free from repercussions when they fail to pay their premium. This basically allows for the individual to pay for only 9 out of 12 months of the year’s worth of health insurance premiums, but still utilize their coverage.

These are both perfectly legal ways that consumers have found the ACA benefitting them, but not ones that ensures that the carriers providing these benefits don’t hemorrhage. The impact is apparent as we watch the major carriers pull out of marketplaces nationwide.

The ACA must evolve if it is expected to be successful, and as we move into the next election cycle, there is not much to be optimistic about.