Mich. insurer doubtful of net jump in plans sold

Published on NewsOK Modified: January 19, 2014 at 8:00 am •  Published: January 19, 2014

LANSING, Mich. (AP) — The uninsured and others still have 2½ months to sign up for government-subsidized private insurance under the federal health care law without facing a tax penalty.

But one Michigan insurance executive said she doubts much new enrollment will occur before the March 31 deadline and cautioned that the net number of people buying their own insurance in the state could stay flat or even dip slightly this year.

Priority Health's chief marketing officer Joan Budden told The Associated Press in a recent interview that while the insurer saw a 30 percent jump in customers buying individual plans in the last quarter — from 20,000 to 26,000 — most of its new customers switched from other insurers that canceled their policies or from employers who dropped coverage. She also estimated that just 10 percent of customers bought new plans compliant with the health law, while the rest chose older cheaper plans — which the state had allowed Priority Health to keep selling temporarily even before President Barack Obama let insurers continue canceled plans for a year.

Michigan had about 275,000 residents in the individual insurance market last year, and Budden said Priority projected it would grow by 250,000 people in 2014 because of the health law. Enrollment began Oct. 1 and goes through March 31.

"I don't think we've gotten a fraction of that," she said, basing her thinking on the company's experience and what she's heard elsewhere in the industry.

Though many insurers have been tight-lipped about sign-ups, Priority opened up some about its experience. The Grand Rapids-based insurer also is expected this week to release results of a survey of customers who recently bought individual plans.

Budden said despite outreach efforts ramping up in the new year, she expects the heaviest amount of enrollment occurred from October through December because customers wanted coverage Jan. 1.

The flawed rollout of the federal insurance website and Michigan's earlier decision not to create its own site didn't help with enrollment efforts, Budden said. But she said a bigger concern is that young and healthy residents are balking at the cost of plans even if they qualify for tax subsidies.