Cheapest Obamacare plan stealing exchange customers from Anthem

We’re two days away from the end of 2015 enrollment in the Obamacare exchanges.
Hadn’t noticed?
You’re not the only one.
Things are far different than the media feeding frenzy that marked both the disastrous rollout of the Obamacare exchanges and the rush of enrollment before the 2014 deadline. I certainly contributed to that frenzy.
But the 2015 enrollment period has been a snoozefest. I wrote one blog post about back in November and haven’t revisited the topic since.
Even the enrollment totals have tracked expectations.
In Indiana, there were 132,000 sign-ups on the exchange last year. And the nine insurers that signed up to compete on the exchange this year predicted they would add 70,000 to 75,000 new customers for 2015.
That would put total 2015 enrollment between 200,000 and 2010,000.
Right on schedule, enrollment hit 198,635 on Feb. 11, according to the U.S. Department of Health and Human Services.
(This number is likely to shrink in the next few weeks, as roughly 40,000 exchange customers that now qualify for the expanded Healthy Indiana Plan switch over to that state-funded program.)
No news is good news for consumers—and probably for the long-term success of the exchanges. (However, the U.S. Supreme Court could throw the exchanges into chaos again this summer if it strikes down the tax credits that nearly one out of every nine Hoosiers have received to reduce the cost of coverage.)
But here’s something that caught my attention. One of the newcomers to the Indiana exchange this year, Ohio-based CareSource, has far outstripped even its own projections for enrollment.
As of Feb. 12, CareSource had 21,000 exchange customers in Indiana. That was more than double the 10,000 it expected right before enrollment began in November. And it was more than five times as much as it projected last May, when it first filed paperwork to sell on the exchange.
CareSource’s premiums were the lowest available this year—even lower than those offered by Anthem Blue Cross and Blue Shield. That has swayed a lot of customers, noted health insurance broker Tony Nefouse—although Anthem will remain, by far, the largest exchange enrollment in 2015. It attracted 83,000 Indiana health plan members during last year’s enrollment period, and expected enrollment to grow about 26 percent this year.

“The people that were really sensitive to cost, they moved from Anthem and went to a lower-costing plan,” Nefouse said. In Marion County, Anthem’s cheapest plan was 13 percent more expensive than CareSource’s cheapest plan, even before the impact of Obamacare’s tax credits.

“Obviously our price is very competitive,” said Steve Smitherman, CareSource’s executive director for Indiana. CareSource is running a health maintenance organization, which limits which providers are covered. Among the major health systems in the Indianapolis area, only Indiana Unviersity Health is part of CareSource’s provider network.

Also, CareSource has blitzed the Indianapolis and Bloomington areas with advertising—on radio, on billboards, on TV. And it has made scores of presentations at community meetings designed to help Hoosiers get signed up for coverage.

“Brand awareness was obviously a concern for us, because we were new to the marketplace,” Smitherman said. The company hired The Ohlmann Group, a marketing firm based in Dayton, Ohio, to create and place ads all over the Indianapolis market—so many, in fact, that the average Indianapolis radio listener hears CareSource’s name 11.6 times per day.

Other health insurers I checked with weren’t disclosing their exchange enrollment, in part because it’s a moving target. There be a rush of enrollment this weekend. Plus, any 2014 exchange customer gets a 90-day grace period, beginning on Jan. 1, before he or she must make a payment in order to renew coverage for 2015. That means any payments made by March 31 would restart coverage for 2015.

“I am not sure that Marketplace plans will know a solid membership total until April,” wrote Jamie Bruce, chief development and marketing officer at MDwise Inc., an Indianapolis-based health plan that expected to add about 10,000 members to the 28,000 it signed up last year. “Our retention goals have exceeded our original expectations, we believe in large part [due] to renewing members’ fear of another bad experience like last year.  Our new member enrollment has been at the higher end of our original expectations.”

So, if you’ve tuned out Obamacare open enrollment these past few months, no problem. Just tune back in in a couple months to see the final results on how it all shook out.

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