STAT BOX
Florida
% in the individual market:
10%
% uninsured:
15%
Per capita health expenditures (rank):
$7,156 (18)

Since the ACA took effect, Florida has led the pack when it comes to individual health insurance enrollment. More than 1.76 million Floridians signed up for coverage in 2017, which is higher than any other state, and the ACA has made a major dent in the number of residents who are uninsured.

“It’s serving a huge population of people who didn’t have health insurance before” because they couldn’t afford to pay for coverage, says Patricia Born, who teaches about insurance and risk management at Florida State University (FSU) and authored a report on Florida’s insurance market for the Brookings Institution. “People were just so happy to be able to get coverage. They had unmet [health care] needs to get addressed.”

Despite Floridians’ embrace of individual health insurance, the state still has one of the highest uninsured rates in the nation. In 2015, 15% of the state’s residents—2.8 million people—remained uninsured, compared with the national average of 10%, according to the Kaiser Family Foundation. Florida, as well as the four other states with an uninsured rate of 15% or more, all failed to expand Medicaid. Yet Florida’s uninsured rate is still a steep drop from the time before the ACA took effect. In 2013, 22% of Floridians didn’t have insurance.

Florida, which is the third most populous state in the country, has a unique health insurance profile. It still attracts retirees in droves and because of the state’s large senior population, its Medicare enrollment of 4 million is second largest in the country, behind California. Though Florida is not a Medicaid expansion state, its high poverty rate and large population have led to a large number of people being covered by Medicaid and the CHIP program; enrollment totaled 4.36 million in March. Meanwhile, it has the second-lowest percentage of residents covered by employer-based health insurance, at 39%. The national average is 49%. Many Floridians work in the construction and hospitality industries, where employers often don’t offer health insurance. The flip side to the lack of employer-provided insurance is a large individual market; in 2015, 10% of the state’s residents had purchased coverage in the nongroup market, the highest percentage in the nation. The national average is 7%.

Currently, only five insurers offer policies on the state’s ACA exchanges. That’s down from eight when the exchanges were launched in 2014, according to Born’s report. Florida Blue, the Blue Cross Blue Shield plan in the state, has been the dominant player in the Florida individual market, and in 2015 had a 41% market share, based on premiums written. Humana ranked second, with 15% of the premiums written.

Patricia Born

“Insurers that are more familiar with the Medicaid individual market” have done well on the exchange, says Patricia Born of Florida State University.

While other major carriers have either pulled out of the Florida individual market or only offer policies outside the exchange, Coventry Health Care, Molina Healthcare, and Ambetter/Sunshine Health have entered the market, Born’s report found. Ambetter is offered on the individual market in 12 states by Centene. “Insurers that are more familiar with the Medicaid individual market, like Molina, have done quite well,” Born says.

Both Cigna and Aetna no longer offered policies on the exchange in 2017, but sell policies outside the exchange, while UnitedHealthcare no longer sells any policies, either on the exchanges or off them. In 2015, the vast majority of individual policies were purchased on the exchange. Less than 215,000 were bought outside the exchange.

Florida Blue’s retail centers

Florida Blue dominates the individual market, with nearly a 50% market share in 2017.

Joseph C. Gregor, the vice president of commercial segments, attributes Florida Blue’s success in the individual market to the company’s “deep knowledge” of how that part of the insurance market works in the state and its history: “We have been providing health care coverage to Florida residents for nearly 75 years.” Florida Blue will continue to offer policies on the exchange in all 67 Florida counties in 2018. Already, in many rural areas it is the only game in town as far as health insurance goes. “When pricing our plans, we did so in a way to ensure long-term growth and stability, as opposed to pricing cheaply to quickly gain market share,” Gregor says. Nationally, enrollment in the individual market fell an average of about 5% in 2017, Gregor points out, while in Florida it ticked up 1%.

Florida Blue also made the unusual decision to invest in 20 brick-and-mortar retail centers, where consumers can physically walk in and get help buying a Florida Blue policy. Since the ACA took effect, more than a half-million consumers have visited a Florida Blue Center, according to Gregor.

Still, partly because Medicaid wasn’t expanded, many Floridians earn too little to be eligible for a subsidy to purchase insurance on the ACA exchange but too much to be eligible for Medicaid. Any hope of expanding Medicaid in the state is currently “DOA,” says Steven Ullmann, director of the University of Miami’s Center for Health Sector Management and Policy. State lawmakers and Republican Gov. Rick Scott have argued that expansion would be a taxpayer-funded entitlement that would be difficult to repeal.

“It’s a perverse situation. Low-income people are unable to get any kind of coverage,” says Leslie Beitsch, the chair of behavioral sciences and social medicine at FSU and a former commissioner of health in Oklahoma. Because of that, says Beitsch, “I think people are actually dying.”

No newcomers

While the individual mandate pushed more healthy people to sign up for health insurance, Born says, medical costs were higher than expected, and “plans raised rates to be sustainable.”

“No new carriers entered the marketplace for the 2017 plan year,” Born wrote. “Regulators have spoken with all health carriers in the state to encourage participation, but carriers report an inability to turn a profit on exchange business and their opportunities to innovate are limited. Florida Blue experimented with offering a low-cost, highly managed HMO plan, ‘MyBlue,’ but customers complained that they could not find participating doctors.”

In many states and in many markets, people want insurance with a network that includes big-name physicians and prestigious hospitals. But in Florida, many consumers simply pick the lowest-cost plan available in their market, Born says. “They’re not too concerned about which doctors they get.”

“When customers are able to compare a lower cost, narrow network to a more expensive broader network, they begin to question the need to be able to go to every single hospital and physician in a given region,” says Mark Cherry, principal analyst with Decision Resources Group, a health care consultancy.

Some Florida markets have more than one large health care system, so an insurer might drop one system from its network but still have an ample number of providers for consumers to choose among, Cherry says. “The acceptance [by consumers] of narrow networks gives leverage to large insurers and large health systems to walk away from negotiations.

“Insurers want to offer a narrow network at a low premium, and a lot of large health systems don’t want to make any reimbursement concessions to get on that narrow network,” he says.

It’s still too early to tell what will happen to the Florida market, given the uncertainty around the ACA.

Beitsch says, “Uncertainty unravels the market. This is so uncertain, it makes it less likely that others [insurers] will enter the market and more likely that those in the market will exit. In some ways, it’s becoming a self-fulfilling prophecy that the ACA won’t work.”

Susan Ladika is a freelance writer in Tampa, Fla., with 30 years of experience covering health care and other issues.