The chaos of the fledgling Affordable Care Act era has given way to something closer to stability. Insurers are seeking the smallest rate increases in three years for 2019. And premium prices will actually decline in the small group market for several carriers.

Though several of Oregon's biggest insurers lost money in the first half of 2018, most are financially strong. Even the weak sister, Moda Health, is back from the financial brink after raising $155 million in fresh capital.

But stability doesn't equate to affordability. Consumers continue to feel the sting of higher costs, whether they get their coverage through the individual market or an employer. It's not just rising premiums; deductibles, co-pays and maximum-out-of-pocket expenses (the dreaded MOOPs in insurance parlance) are high and getting higher.

All this adds up to some eye-popping sums, particularly for the approximately 150,000 Oregonians who buy insurance on the individual market. One Portland-area woman just got word from Providence Health Plan that the monthly premium for her and her spouse and two grown sons will jump 24 percent, from $1,270 to $1,577 a month. Their deductible will go from $7,350 to $7,900, a 7.5 percent increase.

Advocates had hoped the Affordable Care Act would end the days when a medical diagnosis could bring financial ruin. But eight years since its passage, even ardent backers of the landmark legislation admit that affordability remains elusive.

"Even those who have health insurance often find themselves unable to afford care or bankrupted by high deductibles and copays and surprise billing by out-of-network services," said Bruce Goldberg, former head of the Oregon Health Authority, who is now a senior fellow at the Center for Health Systems Effectiveness at Oregon Health & Science University.

The affordability gap has spawned some controversial alternatives. The Trump administration has issued new rules promoting the purchase of short-term insurance and so-called "association" policies, which offer limited coverage and premiums at a fraction of traditional health plans.

Gov. Kate Brown dismissed the rule changes as a calculated effort to sabotage the individual market. With her blessing, Oregon insurance regulators rejected the new rule promoting short-term policies.

"I think the Trump administration is on a mission to destroy the stability of the state's health care system and the Affordable Care Act," Brown said. "It's absolutely unacceptable to me."

THE OPTIONS

When open enrollment begins Nov. 1, Oregonians will find a market still dominated by five major carriers —

Kaiser, Providence, Regence BlueCross BlueShield, Moda and PacificSource. Health Net, Samaritan, United Healthcare and Bridgespan, an affiliate of Regence, also submitted rate proposals to the Oregon Insurance Division last spring.

In July, state regulators made their final rate decisions.

In the individual market, the rate changes range from a 9.6 percent decrease for PacificSource to a 10.1 percent increase for Providence. For a single person buying silver standard coverage, that will mean monthly premiums of $415 to $486 a month.

In the small group market, the new rates ranged from a 4 percent decrease for Health Net to a 7.2 percent increase for United Healthcare. A single 40-year-old buying silver-level coverage will pay monthly premiums of $295 to $387.

Those numbers are nondescript compared with 2016 and 2017, when companies were still struggling to adjust to the new landscape wrought by Obamacare. Moda raised its individual market rates about 25 percent in 2016 and nearly 30 percent in 2017. In the same period, Providence's rates climbed 13.8 percent and 29.6 percent respectively.

Mark Griffith, a health policy analyst at the Portland-based consumers group OSPIRG, said the state's new reinsurance program helped keep the 2019 rate increases low. Oregon was the third state in the country granted federal dollars — $54 million to start — to create the fund that protects insurance companies from hugely expensive claims.

The reinsurance fund kicks in when an individual patient's claims exceed $95,000 and will cover half the patient's costs beyond that with a cap of $452,500.

"It is genuinely working and that's pretty cool," Griffith said. "I was happy to see that Oregon was following up on this."

During open enrollment, which runs from Nov. 1 to Dec. 15, some Oregonians will have far fewer choices than the nine aforementioned carriers. Insurance companies can pick and choose which counties they'll do business in and many are avoiding rural areas. Residents in rural areas tend to be heavier users of health care than their urban counterparts and are therefore less profitable for insurance companies.

In several rural counties, just two carriers offer policies. In Lincoln and Douglas counties, Health Net is the only game in town.

AFFORDABILITY CRISIS

As a business owner, Portland bankruptcy attorney Ann Chapman knows firsthand the pain of rising health insurance costs. But she said the problems of one of her clients powerfully illustrated the profound cost-shifting going on in today's insurance market.

The woman has a good job and decent insurance. But after a series of health issues and medical procedures, Chapman's client and her husband faced out-of-pocket medical bills in excess of $20,000 two years in a row.

"The numbers are just staggering," Chapman said. "The thing is, they weren't even life-threatening problems — some dental work, a hip replacement. The medical is just killing them."

As health care costs rise, insurers are increasingly taking steps to limit their exposure and shift some of the expense to consumers. The average deductible for a single person who gets health coverage through an employer jumped from $303 in 2006 to $1,221 in 2017, according to new data from the Kaiser Family Foundation.

In the individual market, the rise of deductibles has been particularly dramatic. The average deductible for a low-end bronze plan has gone from zero in 2015 to $5,000 in 2019, according to information compiled by the state insurance commission. Similarly, low-end silver plans in Oregon had no deductible in 2015. Four years later, it is $2,500.

Family coverage multiplies the deductible. For example, the deductible for Providence's silver plan in the family market will hit $5,700 in 2019, up 14 percent from $5,000 this year.

Nevertheless, high-deductible plans have come to dominate the market. The National Center for Health Statistics reported last month that among adults 18 to 64 who get coverage through their employer, 43.4 percent are enrolled in a high-deductible plan, compared with 14.8 percent in 2007.

Insurers contend they have little choice but to spread the costs, which continue to increase, particularly pharmaceuticals. Insurance carriers are simply passing along the inexorable price hikes, said Cathy Donaldson, a spokeswoman for America's Health Insurance Plans, a trade group.

But some consumers simply can't afford to pay their deductibles and copays.

Todd Trieweiler, a Portland bankruptcy attorney, said medical-related bankruptcies made up 35 to 40 percent of his business before the passage of the Affordable Care Act in 2010. Those without insurance would rack up enormous health care debt, then turn to bankruptcy court after maxing out their credit cards.

Such bankruptcies plummeted after Obamacare dramatically reduced the number of uninsured. But now, medical bankruptcies are on the rise, this time by people who have health insurance but can't afford the deductibles and other out-of-pocket expenses.

"It's hitting the middle and upper middle class," Trieweiler said. "They have insurance through their employer, but it's crappy coverage with huge deductibles. They might as well not have insurance."

NEW ALTERNATIVES

In response to rising prices, some companies are entering the market with cheaper, non-traditional products.

Short-term and so-called "association" plans offer limited health coverage at a fraction of the price of traditional insurance. The Trump administration implemented new rules in 2017 and 2018, making these alternatives more practical and easier to get. For instance, the administration lengthened the maximum coverage timespan for short-term insurance from three months to three years.

"These alternatives are getting increasingly popular," said Chris Wang, an insurance broker with the Portland Benefits Group. "You can save $15,000 a year for a minimum essential coverage plan."

These insurance alternatives are controversial. ACA advocates contend the new rules are part of an effort to torpedo Obamacare. They fear younger, healthier Americans will dump their traditional insurance, leaving older, sicker people in the Obamacare pool. That would force insurers to raise premiums further.

Oregon regulators don't share Trump's enthusiasm. Insurance Commissioner Andrew Stolfi rejected the extension of short-term coverage durations, choosing to stick with the state's existing three-month limit.

Politics aside, the lower premiums are resonating with consumers.

Diane Faligowski, owner of Health Plans in Oregon, a Portland-based insurance brokerage, recounts the experience of one of her customers — a young, healthy woman who was paying $226 a month for a bronze-level plan in the individual market. Her traditional policy had a huge deductible, $6,500, and a $7,350 maximum out of pocket.

The customer wanted to pay less and pressed Faligowski for a solution.

They settled on a short-term plan from National General. Faligowski warned her client that the short-term plan didn't cover prescriptions, maternity care or mental health. "It's basically catastrophic coverage," Faligowski said. "And the price is not fixed. It can go up after three months."

But the price tag was right. The woman's new coverage cost her $92 a month with a $2,500 deductible and a $4,000 maximum out-of-pocket.

Association plans are seen as primarily for trade groups, business owners and religious organizations, which could join together to purchase coverage. Trump signed new rules into place in June, making it easier to sell and buy this kind of insurance.

Trump predicted big things. "We've created associations, millions of people are joining associations. Millions. That were formerly in Obamacare or didn't have insurance. Or didn't have health care. Millions of people," he told The New York Times. "That's gonna be a big bill, you watch. It could be as high as 50 percent of the people. You watch. So that's a big thing."

OSPIRG's Griffith warned consumers to shop carefully. "While the low monthly premiums may be tempting for individuals who don't have ongoing health issues, once you need to make a claim, you may find the plan doesn't cover much at all," he said. "It's junk insurance, and not worth the premiums."

—Jeff Manning | 503-294-7606 | @JeffmanningOre