Tennessee's ACA exchange woes may be of its own making

Document titled, Affordable Care Act
People in Tennessee can purchase underwritten plans through the state's Farm Bureau, an attractive option for healthier enrollees. (Getty/Designer491)

In Tennessee, people in several counties may have no choices on the Affordable Care Act exchanges next year, making the state a poster child for Republicans' claims about the law's failures. But state officials themselves may bear part of the blame for that problem.

Tennessee continues to allow non-ACA compliant, underwritten plans to be sold to consumers through an association, the Tennessee Farm Bureau, according to a blog post from the Center on Health Insurance Reforms at Georgetown University’s Health Policy Institute. And that may be siphoning off healthier, less expensive consumers.

The association is open to all state residents for a fee, and the underwritten plans are appealing to healthy enrollees because they’re less expensive than the ACA-compliant insurance options. People who want to enroll in the plans are screened for high-cost health conditions before enrollment, according to the post.

Insurers will need to re-enter the ACA exchanges to ensure that people in all parts of Tennessee have access to coverage, but that could be a hard sell, according to the blog. If more healthy people enroll in the Farm Bureau’s inexpensive plans, the risk pool could be untenable for insurers looking to turn a profit.

Humana's decision to exit the ACA exchanges entirely made Tennessee's already struggling marketplace even worse for some consumers, as it means that 40,000 Knoxville residents will be left without an on-exchange insurance option next year, Sen. Lamar Alexander, R-Tenn., said in an announcement in February.

A bill Alexander introduced in the Senate aims to provide relief to counties that may not have options on the ACA exchange while Republicans in Congress continue to mull their options to repeal and replace the law. Without such relief, Alexander said, the ACA’s subsidies amount to “bus tickets in a town with no buses running” for many in the state.