Colorado Data May Indicate Good Obamacare News For WellPoint
One of the big fears for health insurers competing on the Obamacare Exchanges was the potential that a bad health makeup of enrollees would end up hurting the insurers. The first batch of rate filings in the state of Colorado appears to signal that at least for for WellPoint , one of the largest public participants in the exchanges, these worries may have been overblown.
Filings released on Monday indicate that HMO Colorado, WellPoint's Anthem subsidiary in Colorado, rather than raising premiums to meet costs is actually seeking to reduce the average premiums it is charging in Colorado. The requests to reduce premiums on existing plans going into 2015 is a sign that the company managed to appropriately price its plans for the 2014 enrollment, meeting the expected costs incurred by policyholders.
|Company||Lives Covered||Min Chg %||Max Chg %||Wgt. Avg|
|Colorado Health Insurance Coop||7,965||-37.89||-.74||-9.63|
|Rocky Mountain HMO||16,296||-2.2||25.4||3.1|
The data from the filings also shows another strong signal for WellPoint. Despite having profitable premiums the company was able to enroll a large share of total lives covered on the state's exchange. In our analysis of other states that have already released rate requests, the cheapest insurance carriers typically had the largest market share. Comparing on-exchange plans in Colorado shows that the Anthem / HMO Colorado plans are generally more expensive than counterparst offered by insurers like Humana and Kaiser.
Despite these higher prices, the filings indicate that Anthem plans cover a significant portion of total lives. While most of the data has indicated that consumers were primarily focused on premiums when it came to plan selection, WellPoint's offerings seem to have bucked that trend. This performance may be a result of the strength of the Blue Cross Blue Shield brand its plans are marketed under.
While Colorado is only one of the 13 states where the company operates a Blue Cross / Blue Shield plan this first batch of data should allay some of the worries investors had regarding how the individual health insurance polices may impact the company's bottom line. Better yet is the possibility that the company may be in a position to pick up a significant enrollment market share over the next few years on the strength of its brand.
This article originally appeared on Value Penguin.
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