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Obamacare premiums to jump as much as 22 percent for some North Dakotans

FARGO — Individual North Dakota health insurance customers covered under the federal health care exchange will face average premium increases next year ranging from 7.9 to 22.6 percent.

Those premium increases, effective Jan. 1, are for plans in North Dakota sold via the online exchanges under the Affordable Care Act, commonly called Obamacare.

Customers of Blue Cross Blue Shield of North Dakota, the state's largest private health insurer, who buy individual coverage through the exchange will see their premiums increase an average of 22.6 percent.

Individuals covered by the Sanford Health Plan under the exchange face average premium increases next year of 7.9 percent.

North Dakota's other major health insurer, Medica, has approval to raise its individual rates 18.8 percent, but has announced that it does not expect to sell individual coverage under the exchange next year.

The annual round of premium increases comes as insurers scramble to prepare for open enrollment for next year's coverage under the Affordable Care Act, which begins Nov. 1 and lasts 45 days.

The North Dakota Blues' chief executive said the spike in rates, which follows a decrease of 1.57 percent, are because of an influx of new customers — an increase of 30 percent — who might have been sicker than their previous base of customers.

The individual market is more susceptible to dramatic swings than the group health insurance market, said Tim Huckle, Blue Cross Blue Shield's president and CEO. Also, he said, the marketplace exchange allows consumers to easily make price comparisons, so consumers are prone to switch coverage.

"I think we could see this go back and forth each year," Huckle said. "I think we could see a flip-flopping, back and forth."

Insurance Commissioner Jon Godfread, who approved the rate increases, said they were justified by claims the insurers have paid. "The cost of health care is continuing to go up," he said.

Kirk Zimmer, who heads the Sanford Health Plan, said the insurer has worked hard to hold its costs down, including close cooperation with health providers to achieve efficiencies.

One problem that has plagued the individual market since the inception of Obamacare, Zimmer said, is that it has not been able to attract enough young, healthy customers to offset costs from the older, sicker customers who have flocked to the coverage.

Small-group coverage

More modest premium increases have been approved for small-group coverage sold through the Obamacare exchange in North Dakota.

Groups covered by Blue Cross Blue Shield of North Dakota will face average premium increases of 11.8 percent, while Sanford's small groups will see an average increase of 7.9 percent.

Medica small-group premiums will increase an average of 6.2 percent to 8.8 percent next year.

Blue Cross Blue Shield group coverage not sold through the marketplace generally experienced lower increases, Huckle said.

Uncertainty stemming from Congress' failure to agree on health reforms also plagues the Affordable Care Act market, Godfread said.

In fact, Medica cited uncertainty over the fate of continued federal subsidies to defray premium costs as the reason it plans to withdraw from the North Dakota Obamacare individual market next year.

In approving the premium rate increases, Godfread said his office assumes that the subsidies will continue, but acknowledged uncertainty plagues the health insurance market.

Congressional Republicans, who have campaigned for years on a promise to repeal and replace Obamacare, have failed despite multiple attempts to kill the program.

Godfread, a Republican, said he believes the Affordable Care Act marketplace is under significant strain, and advocates trying to shore it up to serve the people who rely on it for their health insurance.

"This marketplace exists," he said. "It's still the law of the land," intended to help low-income people get health insurance. "In my opinion this market is crumbling. I'd much rather see it fixed before it collapses."

A large question hanging over the Obamacare market is whether the Republican-controlled Congress will continue the federal subsidies that help hold down premiums. Godfread, Huckle and Zimmer all said they thought the subsidies would be maintained, at least for now.