Affordable Care Act Could Raise Costs For Guam Residents

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Banking commission minutes note 55% increase for insurers

By Gaynor Dumat-ol Daleno

HAGÅTÑA, Guam (Pacific Daily News, Oct. 30, 2013) – Insured Guam residents may end up paying as much as 55 percent more for the cost of health insurance as a result of the federal Affordable Care Act, a document shows.

"The insurance companies expect to have 35 to 55 percent increases in our health insurance rates based on what they have to pay out," minutes of the Banking and Insurance Commission meeting of Sept. 5 state. The minutes of the meeting became available recently.

Banking and Insurance Commissioner Art Ilagan said yesterday representatives of the local health insurance industry provided the information on potential health insurance cost increases.

As of yesterday, none of the four main health insurance companies on Guam -- SelectCare, StayWell, TakeCare and NetCare -- had submitted a plan to raise insurance rates, Ilagan said.

If any of the insurance companies wants to raise rates for next year's health insurance coverage, the plan must be submitted to the Banking and Insurance Commission if the planned increase is more than 10 percent of current rates, Ilagan said.

The federal Affordable Care Act, called "Obamacare" by its critics, provides additional benefits and protections to the insured. For example, insurance companies are forbidden from putting lifetime and yearly dollar limits on coverage of essential coverage benefits, allows children as old as 26 to stay on a parent's health insurance plan, and prohibits health insurance companies from arbitrarily dropping coverage when a member gets sick, the federal Health and Human Services states.

These and other provisions come at an added cost to health insurance companies, which could mean higher health insurance costs, minutes of last month's Banking and Insurance Commission meeting indicate.

To provide a safety net and options for employers and employees who may be pushed out of their current insurance provider's prices, the federal Health Insurance Marketplace was rolled out recently to allow a nationwide open enrollment.

The Health Insurance Marketplace allows working men and women to qualify for subsidies to help make their health insurance affordable under the federal Health Insurance Marketplace.

A few weeks ago, the Marketplace's online rollout was plagued with glitches, but the U.S. Department of Health and Human Services states some of the problems are now fixed.

When you choose Guam on the federal Health Insurance Marketplace, it gives you this response: "If you live in Guam, you're not eligible to use the Marketplace to apply for health insurance."

Some states, including Hawaii, have created their own health insurance marketplace websites. rolled out on Oct. 15, allowing Hawaii residents to choose from a range of insurance plan options, compare plan specifics and prices and enroll, and those who qualify for tax credits will be able to enter information about their income and family size, the website states.

The federal Health Insurance Marketplace tells anyone who chooses Guam on a pulldown menu to "Check with your territory's government offices to learn about health coverage options."

Opted out

On Oct. 1, GovGuam opted out of the national health insurance exchange program, which is a key component of the federal Affordable Care Act.

Gov. Eddie Calvo wrote to the federal Health and Human Services and Guam legislative Speaker Judith Won Pat about the decision.

Though 22 percent of Guam residents are uninsured, the local government can't afford the costs associated with running a health exchange, the governor wrote to Speaker Judith Won Pat on Oct. 1. States and territories had until Oct. 1 to opt in or out of the national health exchange program.

The federal allocation for Guam -- $24 million for health insurance premium and cost share assistance for 2014 through 2019 -- isn't sufficient, the governor wrote.

GovGuam would need $74 million a year in subsidy alone, the governor said, for the Advance Premium Tax Credit that participants of the health insurance exchange can apply for -- had Guam opted in.

GovGuam received a $1 million federal grant to establish a health exchange, and that money would now have to be returned as a result of the decision to opt out, the governor wrote.

In addition to the cost of the tax credit, the annual cost of operating the exchange would be $30 million, raising the tab to GovGuam to $104 million during the first year alone, the governor wrote.

GovGuam asked to be a part of the Hawaii health exchange but was denied, the governor wrote.

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