Arizona’s Best Health Insurance Options for 2018

Written by Joanna Morrow

Joanna Morrow, Principal and Founder of Employer Benefits & Advice, is an employer consultant and advocate who has worked in the employee benefits industry for over two decades. She works diligently to help employers overcome obstacles in their business by sharing her expertise in Human Resources, Benefits & Compensation, Process Mapping, Risk Management and ERISA/DOL/IRS compliance. She is a licensed life and health insurance professional in the State of Arizona and is an active member of the National Association of Health Underwriters (NAHU).

Arizona’s Best Health Insurance Options for 2018

With all of the changes to the individual health insurance market in Arizona in recent years it can be difficult for employees to determine what their medical insurance options are outside of their employer-sponsored health plan.

Often I find that employers themselves aren’t confident in the quality of coverage they’re offering when compared to what’s available in the individual market. If you’re wondering if employees could buy better health insurance privately on their own in Arizona the short answer is “no”.

The Arizona individual insurance market has deteriorated so much in the last two years that no matter what kind of coverage the employer offers it is almost guaranteed to be superior to what employees could now buy on their own in the individual market.

There are two types of health insurance markets. One focuses on individual policies, the other on group policies. See definitions below:

1 – Individual Policies – that which an individual purchases direct from an insurance company, and

2 – Group Policies – purchased by an employer and made available to a group of employees and their families.

The Demise of the Arizona Individual Market

Although there are a number of factors driving cost, here is a simple description of the biggest factor behind the dramatic price increases in individual policies.

The Affordable Care Act (ACA) forced insurance companies to sell individual policies to any potential buyer regardless of pre-existing health conditions. This would have been okay if, for every buyer with a chronic illness and high claims costs there had been 10 buyers who posed little risk in terms of claims costs. This is the formula that makes all insurance work, regardless of whether it’s home, health or auto insurance.

But that was not the case.

Instead, the majority of the population who purchased individual health policies in 2014 and beyond did so because they had been unable to purchase it in the past due to pre-existing health conditions.

At the same time – the tax penalty that was supposed to force young, healthy individuals to purchase insurance wasn’t enough so the masses that were expected to run out and buy insurance in response didn’t. As such, the law of large numbers – the fundamental principle necessary to make insurance work – wasn’t accomplished.

Individual Policies and the 4 “P”s

In response, Arizona insurance companies have continued to make drastic changes to the standard 4 “P”s that drive their marketing strategy – price, product, place and promotion. The impact of these changes is being felt by many employers.

#1 – Price:

Individual policies premiums have increased dramatically and the older you are the more you pay.

The impact for employers I see most often occurs when employees are ready to retire and go on Medicare but have a spouse who has not yet reached age 65. When given a choice of an individual policy or COBRA for the spouse (which only lasts up to 18 months anyway), these employees often see no alternative but to postpone retirement and continue to cover their spouse on the employer plan until he/she reaches age 65. It can be an unfortunate situation for employers as these employees are already in retirement mode and not always productive.

#2 – Products:

Products are extremely limited.

Individual policies in 2018 are limited to HMO plans. This means that individual policies in Arizona require covered members to choose a primary care doctor who then acts as the gatekeeper for access to specialists, MRIs, and various other specialty services. A person can no longer make those appointments on their own without input from the primary doctor.

In addition, individual plans now only provide a network in one or two counties. That means there is no in-network coverage offered outside of a policy holder’s State, or often outside of their county for that matter, greatly reducing the number of physicians by which a policy holder can be treated.

#3 – Place:

Where you live influences what you can buy.

Carriers have limited, and in some cases eliminated their product offering in certain regions throughout the State.

As an example, if you live in Maricopa County and wish to purchase an individual policy through Blue Cross, United Health Care or Aetna in 2018, you are out of luck. Those carriers have pulled out of the individual market altogether in Maricopa County for Blue Cross, altogether in Arizona for UHC and Aetna. Some still honor grandfathered policies, so anyone who has one of those in force was smart to hang on to it. If you live in Tucson, there is no choice. Health Net is the only carrier selling an individual product in Pima County.

#4 – Promotion:

Insurance companies are no longer promoting their individual product lines.

To ensure no one else is promoting them either, most have stopped compensating brokers who traditionally specialized in this area and assisted individuals with purchasing coverage.

Sadly, at a time when individuals could use the most help in navigating such a complex marketplace, most buyers find they are on their own.

Leveraging Employer-Sponsored Medical

In the end, employers can rest assured that the simple offer of group coverage delivers many more options to employees via larger networks, better products, national carriers, better coverage, and often less expensive premiums than they would be able to purchase on their own.

When someone asks me “What’s the best insurance I can buy in Arizona?” I tell them “Anything you can buy through your employer.”

By better understanding the landscape of the 2018 individual market Arizona employers can leverage the value of their company medical plans and work to better incorporate it into their attraction and retention strategies.

Arizona 2018 Individual Health Insurance Market By County

 

LEGEND for availability of individual coverage in Arizona.


BCBSAZ is selling Gold, Silver and Bronze HMO plans at www.healthcare.gov


BCBSAZ is selling Gold, Silver and Bronze HMO plans at www.healthcare.gov


AmBetter (the name of Health Net’s individual product) is selling Gold, Silver and Bronze at www.healthcare.gov

AmBetter (the name of Health Net’s individual product) is selling Gold, Silver and Bronze HMO plans at www.healthcare.gov

CIGNA is selling direct to individual customers. For a quote customers can visit:
https://www.cigna.com/individuals-families/shop-our-health-insurance-plans?WT.z_nav=personal;HeroImage-Banner;CIGNA%20HEALTH%20INSURANCE

Ready for a New Discussion About Health Insurance and Employee Benefits? Feel free to email me at jmorrow@employerbenefitsandadvice.com or call me at 602-903-4047.